S-1

As filed with the Securities and Exchange Commission on September 12, 2014

Registration No.333-                

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-1

REGISTRATION STATEMENT

UNDER THE SECURITIES ACT OF 1933

FRESHPET, INC.

(Exact name of registrant as specified in its charter)

Delaware	2047	20-1884894
(State or other jurisdiction of incorporation or organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)

400 Plaza Drive, 1st Floor

Secaucus, New Jersey 07094

(201) 520-4000

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Richard Kassar

Chief Financial Officer

400 Plaza Drive, 1st Floor

Secaucus, New Jersey 07094

(201) 520-4000

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies of all communications, including communications sent to agent for service, should be sent to:

Christian O. Nagler, Esq. Andrew M. Herman, Esq. Kirkland & Ellis LLP 601 Lexington Avenue New York, New York 10022 (212) 446-4800 Marc D. Jaffe, Esq. Senet S. Bischoff, Esq. Latham & Watkins LLP 885 Third Avenue New York, New York 10022 (212) 906-1200

Approximate date of commencement of proposed sale to the public:

As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box:  ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities act registration statement number of the earlier effective registration statement for the same offering.  ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer x (Do not check if a smaller reporting company) Smaller reporting company ¨

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Proposed Maximum Aggregate Offering Price(1)(2)	Amount of Registration Fee
Common Stock, $0.001 par value per share	$100,000,000	$12,880

(1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended.

(2) Includes the offering price of any additional shares of common stock that the underwriters have the option to purchase.

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

Subject to Completion. Dated September 12, 2014.

            Shares

Freshpet, Inc.

Common Stock

This is an initial public offering of shares of common stock of Freshpet, Inc.

Freshpet is offering             of the shares to be sold in the offering. The selling stockholders identified in this prospectus are offering an additional             shares. Freshpet will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders.

Prior to this offering, there has been no public market for the common stock. It is currently estimated that the initial public offering price per share will be between $             and $            . Freshpet intends to list the common stock on the         under the symbol “     .”

We are an “emerging growth company” as defined under the federal securities laws and, as such, will be subject to reduced public company reporting requirements. See “Prospectus Summary—Implications of Being an Emerging Growth Company.”

See “Risk Factors” on page 13 to read about factors you should consider before buying shares of the common stock.

Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

	Per Share	Total
Initial public offering price	$	$
Underwriting discount	$	$
Proceeds, before expenses, to Freshpet	$	$
Proceeds, before expenses, to the selling stockholders	$	$

To the extent that the underwriters sell more than             shares of common stock, the underwriters have the option to purchase up to an additional             shares from Freshpet and the selling stockholders at the initial price to public less the underwriting discount.

The underwriters expect to deliver the shares against payment in New York, New York on                     , 2014.

Goldman, Sachs & Co. Credit Suisse

Baird Stifel SunTrust Robinson Humphrey Canaccord Genuity

Prospectus dated                     , 2014.

TABLE OF CONTENTS

	Page
PROSPECTUS SUMMARY		1
RISK FACTORS		13
FORWARD-LOOKING STATEMENTS		32
USE OF PROCEEDS		34
DIVIDEND POLICY		35
CAPITALIZATION		36
DILUTION		38
SELECTED HISTORICAL CONSOLIDATED FINANCIAL AND OTHER DATA		40
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		44
BUSINESS		64
MANAGEMENT		76
EXECUTIVE COMPENSATION		82
PRINCIPAL AND SELLING STOCKHOLDERS		92
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS		94
DESCRIPTION OF CAPITAL STOCK		97
SHARES ELIGIBLE FOR FUTURE SALE		101
MATERIAL U.S. FEDERAL INCOME AND ESTATE TAX CONSIDERATIONS FOR NON-U.S. HOLDERS		104
UNDERWRITING		108
LEGAL MATTERS		112
EXPERTS		112
WHERE YOU CAN FIND MORE INFORMATION		112
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS		F-1

We have not and the underwriters have not authorized anyone to provide you with any information other than that contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. We are offering to sell, and seeking offers to buy, shares of our common stock only in jurisdictions where such offers and sales are permitted. The information in this prospectus or any free writing prospectus is accurate only as of its date, regardless of its time of delivery or the time of any sale of shares of our common stock. Our business, financial condition, results of operations and prospects may have changed since that date.

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MARKET, RANKING AND OTHER INDUSTRY DATA

This prospectus contains industry and market data, forecasts and projections that are based on internal data and estimates, independent industry publications, reports by market research firms or other published independent sources. In particular, we have obtained information regarding the pet food industry from Euromonitor International (“Euromonitor”), the American Pet Products Association (“APPA”), and Packaged Facts, a division of Market Research Group LLC (“Packaged Facts”). Other industry and market data included in this prospectus are from internal analyses based upon data available from known sources or other proprietary research and analysis.

We believe these data to be reliable as of the date of this prospectus, but there can be no assurance as to the accuracy or completeness of such information. We have not independently verified the market and industry data obtained from these third-party sources. Our internal data and estimates are based upon information obtained from trade and business organizations, other contacts in the markets in which we operate and our management’s understanding of industry conditions. Though we believe this information to be true and accurate, such information has not been verified by any independent sources. You should carefully consider the inherent risks and uncertainties associated with the market and other industry data contained in this prospectus.

NON-GAAP FINANCIAL MEASURES

We believe that our financial statements and the other financial data included in this prospectus have been prepared in a manner that complies, in all material respects, with generally accepted accounting principles in the United States, or GAAP, and are consistent with current practice with the exception of the presentation of certain non-GAAP financial measures, EBITDA and Adjusted EBITDA (each as defined below).

As used herein, EBITDA represents net loss plus depreciation and amortization, interest expense (including fees on debt guarantee, which we believe are a cost of our financing arrangement and are akin to interest expense), and income tax expense. As used herein, Adjusted EBITDA represents EBITDA plus loss on disposal of equipment, new plant startup expenses and processing, share based compensation and launch expenses. EBITDA and Adjusted EBITDA do not represent, and should not be considered as alternatives to net loss, as determined under GAAP.

We present EBITDA and Adjusted EBITDA because we believe each of these measures provides an additional metric to evaluate our operations and, when considered with both our GAAP results and the reconciliation to net loss, provides a more complete understanding of our business than could be obtained absent this disclosure. We use EBITDA and Adjusted EBITDA, together with financial measures prepared in accordance with GAAP, such as sales, gross profit percentage, and cash flow from operations, to assess our historical and prospective operating performance, to provide meaningful comparisons of operating performance across periods, to enhance our understanding of our operating performance and to compare our performance to that of our peers and competitors. Adjusted EBITDA is further utilized for our covenant requirements under our credit agreement, and additionally an important component of internal budgeting and setting management compensation. We believe EBITDA and Adjusted EBITDA are useful to investors in assessing the operating performance of our business without the effect of non-cash items and other items.

EBITDA and Adjusted EBITDA should not be considered in isolation or as alternatives to net loss, income from operations or any other measure of financial performance calculated and prescribed in accordance with GAAP. Neither EBITDA nor Adjusted EBITDA should be considered a measure of discretionary cash available to us to invest in the growth of our business. Our Adjusted EBITDA may not be comparable to similar titled measures in other organizations because other organizations may

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not calculate Adjusted EBITDA in the same manner as we do. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by the expenses that are excluded from that term or by unusual or non-recurring items. We recognize that both EBITDA and Adjusted EBITDA have limitations as analytical financial measures. For example, neither EBITDA nor Adjusted EBITDA reflects:

• our capital expenditures or future requirements for capital expenditures;

• the interest expense (including fees on debt guarantee, which we believe are a cost of our financing arrangement and are akin to interest expense), or the cash requirements necessary to service interest expense or principal payments, associated with indebtedness;

• depreciation and amortization, which are non-cash charges, although the assets being depreciated and amortized will likely have to be replaced in the future, nor does EBITDA or Adjusted EBITDA reflect any cash requirements for such replacements; and

• changes in or cash requirements for our working capital needs.

Additionally, Adjusted EBITDA excludes (i) non-cash stock based compensation expense, which is and will remain a key element of our overall long term incentive compensation package, and (ii) certain costs essential to our sales growth and strategy, including an allowance for marketing expenses for each new store added to our network and uncapitalizable freight costs associated with Freshpet Fridge replacements. Adjusted EBITDA also excludes certain cash charges resulting from matters we consider not to be indicative of our ongoing operations. Other companies in our industry may calculate EBITDA and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures.

TRADEMARKS, SERVICE MARKS AND TRADE NAMES

We own the trademarks, service marks and trade names that we use in connection with the operation of our business, including our corporate names, logos and website names. This prospectus may also contain trademarks, service marks, trade names and copyrights of other companies, which are the property of their respective owners. Solely for convenience, the trademarks, service marks, trade names and copyrights referred to in this prospectus are listed without the ^TM, ^SM, ^© and ^® symbols, but we will assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensors, if any, to these trademarks, service marks, trade names and copyrights.

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PROSPECTUS SUMMARY

The following summary highlights information appearing elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully. In particular, you should read the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and the notes relating to those statements included elsewhere in this prospectus. Some of the statements in this prospectus constitute forward-looking statements. See “Forward-Looking Statements.”

In this prospectus, unless the context requires otherwise, references to “Freshpet” the “Company,” “we,” “our,” or “us” refer to Freshpet, Inc., the issuer of the common stock offered hereby, and its consolidated subsidiary.

Overview

We started Freshpet with a single-minded mission—to bring the power of real, fresh food to our dogs and cats. We were inspired by the rapidly growing view among pet owners that their dogs and cats are a part of their family, leading them to demand healthier pet food choices. Over the last eight years, we have created a comprehensive business model to deliver wholesome pet food that “pet parents” can trust, and in the process we believe we have become one of the fastest growing pet food companies in North America. Our business model is difficult for others to replicate and we see significant opportunity for future growth by leveraging the unique elements of our business:

Our Brand	We founded the fresh, refrigerated pet food category in North America and our brand transparently communicates our passion and dedication.
Our Product Know-How	Our fresh, refrigerated products are differentiated inside and out from conventional pet food as a result of our proprietary recipes, cooking techniques and packaging developed over the last eight years.
Our Freshpet Kitchens	All of our food is made in the United States, and we own and operate what we believe is North America’s only fresh, refrigerated pet food manufacturing facility, which we call the Freshpet Kitchens, located in Bethlehem, Pennsylvania.
Our Refrigerated Distribution	We are the only pet food company with an established refrigerated supply chain connecting our Freshpet Kitchens to retail stores across North America.
Our Freshpet Fridge	We sell our products through a fast-growing network of company-owned branded refrigerators, known as Freshpet Fridges, installed in over 12,500 retail stores across North America.
Our Culture	We foster a culture of innovation, and we strive to be open, honest and socially responsible in everything we do.

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Freshpet is disrupting the $22.5 billion North American pet food industry by driving consumers to reassess conventional dog and cat food offerings that have remained essentially unchanged for decades. We position our brand to benefit from mainstream trends of growing pet humanization and consumer focus on health and wellness. We price our products to be accessible to the average consumer, providing us with broad demographic appeal and allowing us to penetrate multiple classes of retail including grocery, mass, club, pet specialty and natural. We have successfully expanded our network of Freshpet Fridges within leading blue-chip retail chains including Albertsons, BJ’s, Kroger, Petco, PetSmart, Publix, Safeway, Target, Wal-Mart and Whole Foods. The strength of our business model extends to our customers, who we believe find that Freshpet grows their pet category sales, drives higher traffic, increases shopper frequency and delivers category leading margins. As of June 30, 2014, Freshpet Fridges were located in over 12,500 stores, and we believe there is an opportunity to install a Freshpet Fridge in at least 35,000 stores across North America.

Freshpet’s differentiated pet food empowers pet parents to provide positive nutrition and well-being to their pets. Our success is reflected in the growth we have delivered:

• Our Freshpet Fridge store locations increased from 7,001 in 2011 to 10,836 in 2013, representing a compounded annual growth rate of 24%; and, as of June 30, 2014, we had 12,593 installed Freshpet Fridges, representing 28% growth over the number as of June 30, 2013.

• Our net sales increased from $25.4 million in 2011 to $63.2 million in 2013, representing a compounded annual growth rate of 58%; and for the six months ended June 30, 2014, we reported net sales of $39.7 million representing growth of 38% over the six months ended June 30, 2013.

Freshpet Fridge Store Locations	Net Sales ($ millions)

• Our gross profit margin as a percent of net sales improved 610 basis points from 42.6% in the year ended December 31, 2011 to 48.7% in the six months ended June 30, 2014.

• Our net loss from operations decreased from $23.4 million in 2011 to $12.4 million in 2013; and for the six months ended June 30, 2014, we reported net loss of $5.6 million compared with a net loss of $6.4 million in the six months ended June 30, 2013.

• Our net loss decreased from $24.2 million in 2011 to $21.7 million in 2013; and for the six months ended June 30, 2014, we reported a net loss of $11.4 million compared with a net loss of $10.0 million in the six months ended June 30, 2013.

Our Industry

We compete in the North American dog and cat food market, which had 2013 retail sales of $22.5 billion and has grown at an average compounded annual growth rate of 3.6% from 2008 to 2013, according to Euromonitor. The pet food market has historically been resilient as consumers continue to spend on their pets even during economic downturns. Within the pet food market, premium and/or natural brands are gaining market share, according to Packaged Facts. We believe pet food industry

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growth is being driven by increasing pet ownership in U.S. households, a growing trend of pet humanization as pet owners view their pets as family members, and a greater consumer focus on health and wellness.

The pet food purchasing decision is underpinned by higher brand loyalty than many other consumer packaged goods categories. A consumer selecting a pet food brand resists frequent switching in order to avoid disrupting the pet’s diet, resulting in high repeat purchasing behavior. As a result, we believe that as consumers try fresh, refrigerated pet food, they are likely to become repeat users of the product.

Our Competitive Strengths

We believe that the following strengths differentiate Freshpet and position us to become a leading brand in pet food:

The category defining brand in fresh, refrigerated pet food.    Freshpet is the first and only fresh, refrigerated pet food brand distributed across North America. Our products represent a significant innovation in pet food, and we have developed a brand proposition that pet parents can intuitively trust.

All of our meats and vegetables are sourced in North America, and all of our products are made in the United States. We use simple, fresh ingredients that are gently cooked without preservatives. Pet parents can easily recognize ingredients in our products as being similar to fresh food they buy for their families. In palatability tests commissioned by us and conducted by third party kennels, dogs chose Freshpet over other leading pet food brands by a wide margin. In addition, according to a study commissioned by us and conducted by a third party researcher, pet parents perceived that Freshpet provides their pets with greater enthusiasm for eating and visible health improvements. By satisfying pet nutritional needs and strong pet parent motivations, we have built a growing base of loyal consumers who we believe have a deep emotional connection to the Freshpet brand.

Proven, scalable and defensible point-of-sale retail model.    We sell our products through a fast-growing network of company-owned branded refrigerators, or Freshpet Fridges, which replace standard shelving in the pet aisle or an end-cap of a retail store. We are the only company to have a branded refrigeration fixture, in-aisle electric power and significant exclusive shelf space in the pet department of leading national retail chains. We believe our Freshpet Fridges generate compelling economics with an average cash-on-cash payback period of less than 15 months, calculated by comparing our total current costs for a refrigerator (including installation and maintenance) to our current margin on net revenues. We have installed Freshpet Fridges across all major classes of pet retail including grocery, mass, club, pet specialty and natural. Our track record of consistently growing the number of store locations with key customers underscores the success of our point-of-sale model.

Selected Customers	Year Entered	Freshpet Fridge Locations at Launch		Freshpet Fridge Locations as of August 1, 2014
Wal-Mart	2007		51		1,578
Petco	2007		97		1,337
PetSmart	2006		29		1,294
Target	2012		50		1,152
Kroger	2007		185		970
Whole Foods	2012		29		206

We believe our customers find that Freshpet grows sales of their overall pet category, drives higher traffic, increases shopper frequency and delivers category leading margins. We believe our attractive business proposition to customers will allow us to continue penetrating store locations of existing and new customers.

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Difficult to replicate know-how, manufacturing facilities and supply chain.    We built and currently operate what we believe is the only fresh, refrigerated pet food manufacturing facility in North America, which was designed by us to operate at human-grade food quality and safety standards. Over the last eight years, we have developed proprietary know-how in the areas of recipes, ingredients sourcing, cooking techniques and product packaging, and have established the only refrigerated pet food supply chain in North America. We have built a team of professionals with unique skills in production and delivery of fresh refrigerated pet food. As a result, our facilities, processes and people represent advantages that would be difficult for others to replicate.

Experienced, committed management team and company culture focused on core values.    We have a deep bench of management talent with a tremendous amount of pet industry experience and significant ownership in Freshpet. The majority of our senior executive team previously worked together to revitalize the Meow Mix brand, and successfully sold it in 2006. Our CEO, Richard Thompson, served as CEO of The Meow Mix Company from 2002 to 2006 and previously founded the American Italian Pasta Company. We believe our culture and core values, spanning Pets, People and Planet, allow us to attract a passionate employee base while also helping pet parents connect with the Freshpet brand.

Our Growth Strategies

We intend to continue growing net sales and profitability through the following growth strategies:

Continue to grow awareness, trial and adoption to increase Freshpet’s North American market share.    Our market share is currently less than 1% of the overall $22.5 billion North American pet food market. As of March 2014, less than 20% of U.S. pet food consumers had aided awareness of the Freshpet brand, which provides us a significant opportunity to grow over time. As a result of our marketing investments, consumer trial of Freshpet products tripled from 2010 to 2013, and repeat purchase rates also increased significantly. In many retail accounts where Freshpet has been available for five years or more, we have achieved between 6%-10% market share of dry and wet dog food sales. We believe that with growing awareness and availability of Freshpet, we have expansive runway to grow trial, adoption and market share.

Continue to grow points of distribution by installing new Freshpet Fridges.    We believe there is a significant opportunity to continue to grow our network of Freshpet Fridges by expanding within the store base of existing and new customers. We grew the number of Freshpet Fridge store locations at a compounded annual rate of 24% between 2011 and 2013. We operate Freshpet Fridges in more than 12,500 stores, and we estimate that there is an opportunity to install a Freshpet Fridge in at least 35,000 retail locations across North America. Over the next three years, we plan to install over              Freshpet Fridges in new retail locations. We expect continued demand for our Freshpet Fridges driven by the strong business proposition and attractive margins that we deliver to customers.

Continue to deliver innovation in pet food and expand our product offerings.    We are continually working to develop new products that are aligned with consumer trends and preferences. Our new products remain true to our founding mission—simple, fresh, good food—while expanding our base of consumers and usage occasions. New product introductions since 2011 represented 31% of our net sales in 2013. We currently have a strong innovation pipeline, including entirely new product platforms that expand the breadth of our fresh product offerings. We also see significant opportunity in the future to expand into pet categories such as cat food and pet treats where we are underpenetrated today. We expect that new product introductions will continue to meaningfully drive growth going forward.

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Continue to enhance our operating margins.    We intend to enhance our operating margins through efficiencies of scale as we grow our net sales ahead of costs. We have made significant investments in management, manufacturing capacity, information systems and other infrastructure to enable us to pursue our growth. From 2011 through the second quarter of 2014, we expanded our gross margins by approximately 610 basis points from 42.6% to 48.7%. We expect that gross margin improvement and operating leverage from SG&A costs will be a significant driver of earnings growth going forward.

RISK FACTORS

An investment in our common stock involves a high degree of risk. Any of the factors set forth under “Risk Factors” may limit our ability to successfully execute our business strategy. You should carefully consider all of the information set forth in this prospectus and, in particular, should evaluate the specific factors set forth under “Risk Factors” in deciding whether to invest in our common stock. Below is a summary of some of the principal risks we face:

• we may not be able to successfully implement our growth on a timely basis or at all;

• we may not be able to to generate sufficient cash flow or raise capital on acceptable terms to meet our needs;

• we may lose key members of our senior management team;

• our products may be alleged to cause injury or illness or fail to comply with government regulation;

• we may lose a significant customer; and

• our marketing and trade spending programs may prove insufficient or ineffective.

OUR CORPORATE INFORMATION

We were incorporated in Delaware in November 2004 and currently exist as a Delaware corporation. In December 2010, MidOcean Partners and certain of its affiliated entities (collectively, “MidOcean”) became our largest stockholder.

Our principal executive offices are located at 400 Plaza Drive, 1^st Floor, Secaucus, New Jersey 07094. Our telephone number is (201) 520-4000. The address of our corporate website is www.freshpet.com. The information contained in or that can be accessed through our website does not constitute a part of, and is not incorporated by reference into, this prospectus.

EQUITY SPONSOR

MidOcean is a private equity firm focused on investing in middle market companies in North America. MidOcean’s targeted sectors include consumer, business & media services and industrial services. Immediately following the consummation of this offering, MidOcean will own approximately     % of our common stock, or     % if the underwriters’ option to purchase additional shares of our common stock is exercised in full.

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IMPLICATIONS OF BEING AN EMERGING GROWTH COMPANY

We qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include:

• a requirement to have only two years of audited financial statements and only two years of related selected financial data and management’s discussion and analysis of financial condition and results of operations disclosure;

• an exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”);

• an exemption from new or revised financial accounting standards until they would apply to private companies and from compliance with any new requirements adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation;

• reduced disclosure about the emerging growth company’s executive compensation arrangements; and

• no requirement to seek non-binding advisory votes on executive compensation or golden parachute arrangements.

The JOBS Act permits emerging growth companies to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We are choosing to “opt out” of this provision, and as a result, we plan to comply with new or revised accounting standards as required when they are adopted. This decision to opt out of the extended transition period is irrevocable.

We have elected to adopt certain of the reduced disclosure requirements available to emerging growth companies. As a result of these elections, the information that we provide in this prospectus may be different than the information you may receive from other public companies in which you hold equity interests. In addition, it is possible that some investors will find our common stock less attractive as a result of our elections, which may result in a less active trading market for our common stock and more volatility in our stock price.

We will remain an emerging growth company until the earliest of (i) the end of the fiscal year following the fifth anniversary of the completion of this offering, (ii) the first fiscal year after our annual gross revenue are $1.0 billion or more, (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities or (iv) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year.

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THE OFFERING

Issuer Freshpet, Inc.

Common stock offered by us              shares (             shares if the underwriters exercise their option to purchase additional shares of our common stock in full).

Common stock offered by the selling stockholders              shares (             shares if the underwriters exercise their option to purchase additional shares of our common stock in full).

Underwriters’ option to purchase additional shares We and the selling stockholders have granted the underwriters a 30-day option to purchase up to an additional              shares of our common stock.

Common stock to be outstanding immediately after completion of this offering Immediately following the consummation of this offering, we will have              shares of common stock outstanding (             shares if the underwriters exercise their option to purchase additional shares of our common stock in full).

Use of proceeds We estimate that the net proceeds to us from this offering, after deducting the underwriting discount and estimated offering expenses payable by us, will be approximately $         million, or $         million if the underwriters’ option to purchase additional shares of our common stock is exercised in full.

We will not receive any proceeds from the sale of shares of our common stock by the selling stockholders.

We intend to use the net proceeds from the sale of common stock by us in this offering (i) to repay our Indebtedness and to effect the Preferred Stock Redemption (each as defined herein), (ii) to support our growth, primarily through installing new Freshpet Fridges and adding manufacturing capacity, and (iii) for working capital and general corporate purposes. For additional information, see “Use of Proceeds.”

Dividend policy We currently intend to retain all available funds and any future earnings to fund the development and growth of our business and to repay

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indebtedness, and therefore, we do not anticipate paying any cash dividends in the foreseeable future. Any future determination to declare and pay cash dividends will be at the discretion of our Board of Directors and will depend on, among other things, our financial condition, results of operations, cash requirements, contractual restrictions and such other factors as our Board of Directors deems relevant. In addition, covenants in our credit agreement restrict our ability to pay dividends. For additional information, see “Dividend Policy.”

Listing We intend to apply to list our common stock on the              under the symbol “            .”

Risk factors Investing in our common stock involves a high degree of risk. See “Risk Factors” beginning on page 13 of this prospectus for a discussion of factors you should carefully consider before investing in our common stock.

Unless otherwise indicated, all information in this prospectus assumes or gives effect to:

• the filing and effectiveness of our amended and restated certificate of incorporation (our “Certificate of Incorporation”) and amended and restated bylaws (our “Bylaws”), which we will adopt immediately prior to the completion of this offering;

• the completion of a         -for-         stock split of our common stock (the “Stock Split”), which will be effected immediately prior to the completion of this offering;

• the conversion of all outstanding shares of our Series C Preferred Stock, par value $0.001 (our “Series C Preferred Stock”), into an aggregate of              shares of common stock (the “Preferred Stock Conversion”), which will occur immediately prior to the completion of this offering;

• the redemption of all outstanding shares of our Series B Preferred Stock, par value $0.001 (our “Series B Preferred Stock”), for cash (the “Preferred Stock Redemption”), which will occur immediately following this offering;

• no exercise by the underwriters of their option to purchase              additional shares of our common stock; and

• an initial public offering price of $         per share, the midpoint of the estimated offering price range set forth on the cover of this prospectus.

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SUMMARY CONSOLIDATED FINANCIAL DATA

The following table presents a summary of our consolidated financial data as of, and for the periods ended on, the dates indicated. The summary consolidated financial data for each of the years ended December 31, 2013 and 2012 have been derived from our audited consolidated financial statements included elsewhere in this prospectus. The summary consolidated statement of operations data for each of the six months ended June 30, 2014 and 2013 and the summary consolidated balance sheet data as of June 30, 2014 have been derived from our unaudited consolidated financial statements included elsewhere in this prospectus. The unaudited consolidated financial statements were prepared on the same basis as our audited consolidated financial statements and, in the opinion of management, reflect all adjustments we consider necessary for a fair statement of financial information. You should read the following financial information together with the information under “Capitalization” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements included elsewhere in this prospectus. Historical results are not necessarily indicative of results to be expected for any future period.

	Year ended December 31,						Six months ended June 30,
	2013			2012			2014			2013
	(Dollars in thousands, except per share data)
Consolidated Statement of Operations Data
Net sales	$	63,151		$	43,519		$	39,736		$	28,732
Cost of goods sold		35,958			22,881			20,370			15,234
Gross profit		27,193			20,638			19,366			13,497
Selling, general and administrative expenses		39,574			35,385			24,996			19,851
Loss from operations		(12,381	)		(14,747	)		(5,630	)		(6,353	)
Other expenses		(538	)		(344	)		(85	)		(29	)
Fees on debt guarantee(1)		(5,245	)		(1,895	)		(3,645	)		(2,034	)
Interest expense		(3,492	)		(1,638	)		(2,033	)		(1,540	)
Loss before income taxes		(21,656	)		(18,624	)		(11,393	)		(9,956	)
Income tax expense		(31	)		(32	)		(16	)		(16	)
Net loss		(21,687	)		(18,656	)		(11,409	)		(9,972	)
Preferred stock dividend accretion		(8,596	)		(7,954	)		(6,904	)		(4,143	)
Net loss attributable to common stockholders	$	(30,283	)	$	(26,610	)	$	(18,256	)	$	(14,115	)
Net loss per share:
Basic	$	(2.16	)	$	(1.90	)	$	(1.30	)	$	(1.01	)
Diluted	$	(2.16	)	$	(1.90	)	$	(1.30	)	$	(1.01	)
Weighted average shares of common stock outstanding:
Basic		14,026,999			14,024,908			14,035,660			14,024,908
Diluted		14,026,999			14,024,908			14,035,660			14,024,908

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	Six months ended June 30, 2014
	Actual			Pro Forma(4)
Pro Forma Earnings per Share Data(2)
Net loss per share (unaudited):
Basic	$	(1.30	)
Diluted	$	(1.30	)
Weighted average shares of common stock outstanding used in computing pro forma net income per share (unaudited):
Basic		14,035,660
Diluted		14,035,660

	Year ended December 31,						Six months ended June 30,
	2013			2012			2014			2013
	(Dollars in thousands)
Other Operating and Financial Data
Freshpet Fridge store locations at period end		10,836			8,514			12,593			9,801
EBITDA(3)	$	(6,974	)	$	(10,363	)	$	(2,591	)	$	(4,470	)
Adjusted EBITDA(3)		(192	)		(6,096	)		413			(1,842	)
Capital expenditures:
Freshpet Kitchens and other plant capital expenditures		12,987			13,298			2,548			11,043
Freshpet Fridge and other capital expenditures		11,656			13,097			7,813			6,660
Total cash outflows of capital expenditures		24,643			26,395			10,361			17,703

	As of June 30, 2014
	Actual			Pro Forma(4)	Pro Forma As Adjusted(5)
	(Dollars in thousands)
Consolidated Balance Sheet Data
Cash and cash equivalents	$	1,924		$	$
Working capital(6)		1,179
Property, plant and equipment, net		55,419
Total assets		74,489
Total debt		83,640
Redeemable preferred stock:
Series B		33,081
Series C		81,510
Total stockholders’ (deficit)	$	(148,829	)	$	$

(1) Represents fees paid to certain stockholders for acting as guarantors for a portion of our payment obligations under the $62.5 Million Revolver (as defined herein). Pursuant to a Fee and Reimbursement Agreement, the Company is obligated to pay each guarantor a contingent fee equal to 10% per annum of the amount each guarantor committed to guarantee. Payments will be made in the form of newly issued shares of Series C Preferred Stock. We plan to use a portion of the proceeds from this offering to repay the borrowings under the $62.5 Million Revolver, relieving us of future fees on the debt guarantee. See our consolidated financial statements and the notes thereto included elsewhere in this prospectus for additional information.

(2) For the calculation of basic and diluted net loss per share and pro forma basic and diluted net loss per share, see notes        and        to our unaudited consolidated financial statements included elsewhere in this prospectus.

(3) EBITDA and Adjusted EBITDA are not financial measures prepared in accordance with U.S. generally accepted accounting principles, or GAAP. As used herein, EBITDA represents net loss

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plus depreciation and amortization, interest expense (including fees on debt guarantee, which we believe are a cost of our financing arrangement and are akin to interest expense), and income tax expense. As used herein, Adjusted EBITDA represents EBITDA plus loss on disposal of equipment, new plant startup expenses and processing, share based compensation and launch expenses.

We present EBITDA and Adjusted EBITDA because we believe each of these measures provides an additional metric to evaluate our operations and, when considered with both our GAAP results and the reconciliation to net loss set forth below, provides a more complete understanding of our business than could be obtained absent this disclosure. We use EBITDA and Adjusted EBITDA, together with financial measures prepared in accordance with GAAP, such as sales, gross profit percentage, and cash flow from operations, to assess our historical and prospective operating performance, to provide meaningful comparisons of operating performance across periods, to enhance our understanding of our operating performance and to compare our performance to that of our peers and competitors.

Adjusted EBITDA is further utilized for covenant compliance under our credit agreement, and additionally, as an important component of internal budgeting and setting management compensation.

EBITDA and Adjusted EBITDA are presented here because we believe they are useful to investors in assessing the operating performance of our business without the effect of non-cash items, and other items as detailed below.

EBITDA and Adjusted EBITDA should not be considered in isolation or as alternatives to net loss, income from operations or any other measure of financial performance calculated and prescribed in accordance with GAAP. Neither EBITDA nor Adjusted EBITDA should be considered a measure of discretionary cash available to us to invest in the growth of our business. Our Adjusted EBITDA may not be comparable to similarly titled measures in other organizations because other organizations may not calculate Adjusted EBITDA in the same manner as we do. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by the expenses that are excluded from that term or by unusual or non-recurring items. We recognize that both EBITDA and Adjusted EBITDA have limitations as analytical financial measures. For example, neither EBITDA nor Adjusted EBITDA reflects:

• our capital expenditures or future requirements for capital expenditures;

• the interest expense (including fees on debt guarantee, which we believe are a cost of our financing arrangement and are akin to interest expense), or the cash requirements necessary to service interest expense or principal payments, associated with indebtedness;

• depreciation and amortization, which are non-cash charges, although the assets being depreciated and amortized will likely have to be replaced in the future, nor does EBITDA or Adjusted EBITDA reflect any cash requirements for such replacements; and

• changes in cash requirements for our working capital needs.

Additionally, Adjusted EBITDA excludes (i) non-cash stock based compensation expense, which is and will remain a key element of our overall long term incentive compensation package, and (ii) certain costs essential to our sales growth and strategy, including an allowance for marketing expenses for each new store added to our network and uncapitalizable freight costs associated with Freshpet Fridge replacements. Adjusted EBITDA also excludes certain cash charges resulting from matters we consider not to be indicative of our ongoing operations. Other companies in our industry may calculate EBITDA and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures.

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The following table provides a reconciliation of EBITDA and Adjusted EBITDA to net loss which is the most directly comparable financial measure presented in accordance with GAAP:

	Year ended December 31,						Six months ended June 30,
	2013			2012			2014			2013
	(Dollars in thousands)
Net loss	$	(21,687	)	$	(18,656	)	$	(11,409	)	$	(9,972	)
Fees on debt guarantee(a)		5,245			1,895			3,645			2,034
Depreciation & amortization		5,945			4,728			3,124			1,912
Interest expense		3,492			1,638			2,033			1,540
Income tax expense		31			32			16			16
EBITDA		(6,974	)		(10,363	)		(2,591	)		(4,470	)
Loss on disposal of equipment		503			333			71			24
Launch expense(b)		3,305			2,815			2,334			1,678
New plant start up expenses and processing(c)		1,996			—			113			436
Share based compensation(d)		978			1,119			486			490
Adjusted EBITDA	$	(192	)	$	(6,096	)	$	413		$	(1,842	)

(a) Represents fees paid to certain stockholders for acting as guarantors for a portion of our payment obligations under the $62.5 Million Revolver. Pursuant to a Fee and Reimbursement Agreement, the Company is obligated to pay each guarantor a contingent fee equal to 10% per annum of the amount each guarantor committed to guarantee. Payments will be made in the form of newly issued shares of Series C Preferred Stock. We plan to use a portion of the proceeds from this offering to repay the borrowings under the $62.5 Million Revolver, relieving us of future fees on the debt guarantee except for changes in fair market value. See our consolidated financial statements and the notes thereto included elsewhere in this prospectus for additional information.

(b) Represents new store marketing allowance of $1,000 for each store added to our distribution network as well as the uncapitalized freight costs associated with Freshpet Fridge replacements. The expense enhances the launch marketing spend to support our growing distribution network.

(c) Represents additional operating costs incurred in 2013 and in the first quarter of 2014 in connection with the opening of our new primary manufacturing facility in Bethlehem, Pennsylvania, which was completed in the fourth quarter of 2013.

(d) Represents non-cash stock based compensation expense.

(4) The pro forma balance sheet data gives effect to the Stock Split, the Preferred Stock Conversion and the Preferred Stock Redemption.

(5) The pro forma as adjusted balance sheet data gives effect to the pro forma adjustments set forth above and the sale of shares of common stock by us in this offering at an assumed initial public offering price of $         per share (the midpoint of the estimated price range set forth on the cover of this prospectus), after deducting the underwriting discount and estimated offering expenses payable by us.

(6) Represents our currents assets minus current liabilities.

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RISK FACTORS

Investing in our common stock involves a high degree of risk. Before you purchase our common stock, you should carefully consider the risks described below and the other information contained in this prospectus, including our consolidated financial statements and accompanying notes. If any of the following risks actually occurs, our business, financial condition, results of operations or cash flows could be materially adversely affected. In any such case, the trading price of our common stock could decline, and you could lose all or part of your investment.

Risks Related to Our Business and Industry

We may not be able to successfully implement our growth strategy on a timely basis or at all.

Our future success depends, in large part, on our ability to implement our growth strategy of expanding distribution by installing new Freshpet Fridges, attracting new consumers to our brand and launching new products. Our ability to increase awareness, consumer trial and adoption of our products, and to implement this growth strategy depends, among other things, on our ability to:

• partner with customers to secure space for our Freshpet Fridges;

• implement our marketing strategy;

• develop new product lines and extensions;

• partner with distributors to deliver our products to customers;

• continue to compete effectively in multiple classes of retail, including grocery, mass, club, pet specialty and natural; and

• expand and maintain brand loyalty.

We may not be able to successfully implement our growth strategy or to grow consistently from period to period. Our business, financial condition and results of operations will be adversely affected if we fail to implement our growth strategy or if we invest resources in a growth strategy that ultimately proves unsuccessful.

We expect to need capital in the future, and we may not be able to generate sufficient cash flow or raise capital on acceptable terms to meet our needs.

Developing our business will require significant capital in the future. To meet our capital needs, we expect to rely on our cash flow from operations, the proceeds from this offering and other third-party financing. Third-party financing in the future may not, however, be available on terms favorable to us, or at all. Our ability to obtain additional funding will be subject to various factors, including general market conditions, our operating performance, the market’s perception of our growth potential, lender sentiment and our ability to incur additional debt in compliance with other contractual restrictions, such as financial covenants under our debt documents.

Additionally, our ability to make payments on and to refinance our indebtedness and to fund planned expenditures for our growth plans will depend on our ability to generate cash in the future. If our business does not achieve the levels of profitability or generate the amount of cash that we anticipate or if we expand faster than anticipated, we may need to seek additional debt or equity financing to operate and expand our business.

We believe that cash and cash equivalents, expected cash flow from operations and planned borrowing capacity are adequate to fund debt service requirements, operating lease obligations, capital

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expenditures and working capital obligations for the next          quarters. However, our ability to continue to meet these requirements and obligations will depend on, among other things, our ability to achieve anticipated levels of revenue and cash flow from operations and our ability to manage costs and working capital successfully. Additionally, our cash flow generation ability is subject to general economic, financial, competitive, legislative and regulatory factors and other factors that are beyond our control. We cannot assure you that our business will generate cash flow from operations in an amount sufficient to enable us to fund our liquidity needs. Further, our capital requirements may vary materially from those currently planned if, for example, our revenues do not reach expected levels or we have to incur unforeseen capital expenditures and make investments to maintain our competitive position. If this is the case, we may seek alternative financing, such as selling additional debt or equity securities, and we cannot assure you that we will be able to do so on favorable terms, if at all. Moreover, if we issue new debt securities, the debt holders would have rights senior to common stockholders to make claims on our assets, and the terms of any debt could restrict our operations, including our ability to pay dividends on our common stock. If we issue additional equity or convertible debt securities, existing stockholders may experience dilution, and such new securities could have rights senior to those of our common stock. These factors may make the timing, amount, terms and conditions of additional financings unattractive. Our inability to raise capital could impede our growth or otherwise require us to forego growth opportunities and could materially adversely affect our business, financial condition and results of operations.

Failure to retain our senior management may adversely affect our operations.

Our success is substantially dependent on the continued service of certain members of our senior management, including Richard Thompson, our Chief Executive Officer. These members of senior management have been primarily responsible for determining the strategic direction of our business and for executing our growth strategy and are integral to our brand and culture, and the reputation we enjoy with suppliers, contract manufacturers, distributors, customers and consumers. The loss of the services of any of these employees could have a material adverse effect on our business and prospects, as we may not be able to find suitable individuals to replace them on a timely basis, if at all. In addition, any such departure could be viewed in a negative light by investors and analysts, which may cause the price of our common stock to decline.

If our products are alleged to cause injury or illness or fail to comply with governmental regulations, we may suffer adverse public relations, need to recall our products and experience product liability claims.

We may be exposed to product recalls, including voluntary recalls or withdrawals, and adverse public relations if our products are alleged to cause injury or illness or if we are alleged to have mislabeled or misbranded our products or otherwise violated governmental regulations. We may also voluntarily recall or withdraw products that we consider below our standards, whether for taste, appearance or otherwise, in order to protect our brand reputation. Consumer or customer concerns (whether justified or not) regarding the safety of our products could adversely affect our business. A product recall or withdrawal could result in substantial and unexpected expenditures, destruction of product inventory, and lost sales due to the unavailability of the product for a period of time, which could reduce profitability and cash flow. In addition, a product recall or withdrawal may require significant management attention. Product recalls, product liability claims (even if unmerited or unsuccessful), or any other events that cause consumers to no longer associate our brands with high quality and safe products may also result in adverse publicity, hurt the value of our brands, lead to a decline in consumer confidence in and demand for our products, and lead to increased scrutiny by federal and state regulatory agencies of our operations, which could have a material adverse effect on our business, financial condition and results of operations.

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We also may be subject to product liability claims and adverse public relations if consumption or use of our products is alleged to cause injury or illness. While we carry product liability insurance, our insurance may not be adequate to cover all liabilities we may incur in connection with product liability claims. For example, punitive damages are generally not covered by insurance. In addition, we may not be able to continue to maintain our existing insurance, obtain comparable insurance at a reasonable cost, if at all, or secure additional coverage (which may result in future product liability claims being uninsured). A product liability judgment against us or our agreement to settle a product liability claim could also result in substantial and unexpected expenditures, which would reduce profitability and cash flow. In addition, even if product liability claims against us are not successful or are not fully pursued, these claims could be costly and time-consuming and may require management to spend time defending the claims rather than operating our business.

The loss of a significant customer, certain actions by a significant customer or financial difficulties of a significant customer could adversely affect our results of operations.

A relatively limited number of customers account for a large percentage of our net sales. During 2013, ten customers, who purchase either directly from us or through third party distributors, collectively accounted for more than 67% of our net sales. Wal-Mart (which purchases through a distributor) and Kroger (which purchases directly from us) each accounted for more than 10% of our net sales during 2013. These percentages may increase if there is consolidation among retailers or if mass merchandisers grow disproportionately to their competition. We expect that a significant portion of our revenues will continue to be derived from a small number of customers; however, these customers may not continue to purchase our products in the same quantities as they have in the past. Our customers are generally not contractually obligated to purchase from us. Changes in our customers’ strategies, including a reduction in the number of brands they carry, shipping strategies, a shift of shelf space to or increased emphasis on private label products (including “store brands”), a reduction in shelf space for pet food items or a reduction in the space allocated for our Freshpet Fridges may adversely affect our sales. Requirements that may be imposed on us by our customers, such as sustainability, inventory management or product specification requirements, may have an adverse effect on our results of operations. Additionally, especially during economic downturns, our customers may face financial difficulties, bankruptcy or other business disruptions that may impact their operations and their purchases from us and may affect their ability to pay us for products purchased from us. Customers may grow their inventory in anticipation of a price increase, or in anticipation of, or during, our promotional events, which typically provide for reduced prices during a specified time or other customer or consumer incentives. To the extent customers seek to reduce their usual or customary inventory levels or change their practices regarding purchases in excess of consumer consumption, our sales and results of operations could be adversely impacted in that period. If our sales of products to one or more of our significant customers are reduced, this reduction could have a material adverse effect on our business, financial condition and results of operations.

Our operating results depend, in part, on the sufficiency and effectiveness of our marketing and trade spending programs.

In general, due to the highly competitive nature of the businesses in which we compete, we must execute effective and efficient marketing investments and trade spending programs with respect to our businesses overall to sustain our competitive position in our markets. Marketing investments may be costly. Additionally, we may, from time to time, change our marketing and trade spending strategies, including the timing, amount or nature of television advertising and related promotional programs. The sufficiency and effectiveness of our marketing and trade spending practices is important to our ability to retain or improve our market share or margins. If our marketing and trade spending programs are not successful or if we fail to implement sufficient and effective marketing and trade spending programs, our business, financial condition and results of operations may be adversely affected.

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The growth of our business depends on our ability to introduce new products and improve existing products in anticipation of changes in consumer preferences and demographics.

Our business is focused on the development, manufacture, marketing and distribution of pet food products. If consumer demand for our products decreased, our business would suffer. Sales of pet food products are subject to evolving consumer preferences and changing demographics. A significant shift in consumer demand away from our products or a decline in pet ownership could reduce our sales or the prestige of our brand, which would harm our business, financial condition and results of operations.

A key element of our growth strategy depends on our ability to develop and market new products and improvements to our existing products that meet our standards for quality and appeal to consumer preferences. The success of our innovation and product development efforts is affected by our ability to anticipate changes in consumer preferences and demographics, the technical capability of our product development staff in developing and testing product prototypes, including complying with governmental regulations, and the success of our management and sales team in introducing and marketing new products. Failure to develop and market new products that appeal to consumers could negatively impact our business, financial condition and results of operations.

Additionally, the development and introduction of new products requires substantial research, development and marketing expenditures, which we may be unable to recoup if the new products do not gain widespread market acceptance. Efforts to accelerate our innovation may exacerbate risks associated with innovation. If we are unsuccessful in meeting our objectives with respect to new or improved products, our business, financial condition and results of operations could be harmed.

Limited manufacturing capacity could have a material adverse effect on our business, financial condition, and results of operations.

All of the products we manufacture in-house are processed through our Freshpet Kitchens in Bethlehem, Pennsylvania, which we believe is North America’s only fresh, refrigerated pet food manufacturing facility. Accordingly, we have limited available manufacturing capacity to meet our quality standards. An unforeseen event, such as a natural disaster or work stoppage, at our Freshpet Kitchens could significantly limit our manufacturing capacity.

Accurate forecasting of sales demand is critical to ensuring available capacity. Our forecasts are based on multiple assumptions, which may cause our estimates to be inaccurate, affecting our ability to obtain adequate manufacturing capacity. Our current plans to meet expected production needs rely in large part on the successful expansion of our Freshpet Kitchens. Any substantial delay may hinder our ability to produce all of the product needed to meet orders and achieve financial performance.

If our growth exceeds our expectations, we may not be able to increase our own manufacturing capacity to, or obtain contract manufacturing capacity at, a level that meets demand for our products, which could prevent us from meeting increased customer demand and harm our business. However, if we overestimate our demand and overbuild our capacity, we may have significantly underutilized assets, and we may experience reduced margins. If we do not accurately align our manufacturing capabilities with demand, it could have a material adverse effect on our business, financial condition and results of operations.

Government regulation, scrutiny, warnings and public perception could increase our costs of production and increase legal and regulatory expenses.

Manufacturing, processing, labeling, packaging, storing and distributing pet products are activities subject to extensive federal, state and local regulation, as well as foreign regulation. In the United States, these aspects of our operations are regulated by the U.S. Food and Drug Administration

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(“FDA”), and various state and local public health and agricultural agencies. The FDA Food Safety Modernization Act provides direct recall authority to the FDA and includes a number of other provisions designed to enhance food safety, including increased inspections by the FDA of domestic and foreign food facilities and increased review of food products imported into the United States. In addition, many states have adopted the Association of American Feed Control Officials’ model pet food regulations or variations thereof, which generally regulate the information manufacturers provide about pet food. Complying with government regulation can be costly or may otherwise adversely affect our business. Failure to comply with applicable laws and regulations could subject us to civil remedies, including fines, injunctions, recalls or seizures, as well as potential criminal sanctions, which could have a material adverse effect on our business, financial condition and results of operations.

Our business is also affected by import and export controls and similar laws and regulations, both in the United States and elsewhere. Issues such as national security or health and safety, which slow or otherwise restrict imports or exports, could adversely affect our business. In addition, the modification of existing laws or regulations or the introduction of new laws or regulations could require us to make material expenditures or otherwise adversely affect the way that we have historically operated our business.

Our business may be subject to false marketing claims.

From time to time we may be subject to claims from competitors or consumers, including consumer class actions, alleging that our product claims are deceptive. Regardless of their merit, these claims can require significant time and expense to investigate and defend. Whether or not a false marketing claim is successful, such assertions could have an adverse effect on our business, financial condition and results of operations, and the negative publicity surrounding them could harm our reputation and brand image.

Adverse weather conditions, natural disasters, pestilences and other natural conditions can disrupt our operations, which can adversely affect our business, financial condition and results of operations.

The ingredients that we use in the production of our products (including, among others, meat, vegetables, fruits, carrageenans, whole grains, vitamins and minerals) are vulnerable to adverse weather conditions and natural disasters, such as floods, droughts, frosts, fires, earthquakes, tornadoes and pestilences. Adverse weather conditions may be impacted by climate change and other factors. Adverse weather conditions and natural disasters can reduce crop size and crop quality, which in turn could reduce our supply of ingredients, lower recoveries of usable ingredients, increase the prices of our ingredients, increase our transportation costs or increase our cost of storing ingredients if harvests are accelerated and processing capacity is unavailable. Additionally, the growth of crops, as well as the manufacture and processing of our products, requires significant amounts of water. Drought or other causes of a reduction of water in aquifers may affect availability of water, which in turn may adversely affect our results of operations. Competing manufacturers may be affected differently by weather conditions and natural disasters depending on the location of their supplies or operations. If our supply of ingredients is reduced, we may not be able to find enough supplemental supply sources on favorable terms, if at all, which could impact our ability to supply product to our customers and adversely affect our business, financial condition and results of operations. Increased costs for ingredients or other inputs could also adversely affect our business, financial condition and results of operations as described in “—The inputs, commodities, and ingredients that we require are subject to price increases and shortages that could adversely affect our results of operations.”

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Additionally, adverse weather conditions, natural disasters or other natural conditions affecting our operating activities or major facilities could cause an interruption or delay in our production or delivery schedules and loss of inventory and/or data or render us unable to accept and fulfill customer orders in a timely manner, or at all. If our operations are damaged by a fire, flood or other disaster, for example, we may be subject to supply or delivery interruptions, destruction of our facilities and products or other business disruptions, which could adversely affect our business, financial condition and results of operations.

If we fail to develop and maintain our brand, our business could suffer.

We believe that developing and maintaining our brand is critical to our success. The importance of our brand recognition may become even greater as competitors offer more products similar to ours. Our financial success is directly dependent on consumer perception of our brand. Our brand-building activities involve providing high-quality products, increasing awareness of our brand, creating and maintaining brand loyalty and increasing the availability of our products.

The success of our brand may suffer if our marketing plans or product initiatives do not have the desired impact on our brand’s image or its ability to attract customers. Further, our brand value could diminish significantly due to a number of factors, including consumer perception that we have acted in an irresponsible manner, adverse publicity about our products (whether or not valid), our failure to maintain the quality of our products, product contamination, the failure of our products to deliver consistently positive consumer experiences, or the products becoming unavailable to consumers. The growing use of social and digital media by consumers increases the speed and extent that information and opinions can be shared. Negative posts or comments about us or our brands or products on social or digital media could damage our brands and reputation. If we fail to maintain the favorable perception of our brands, our business, financial condition and results of operations could be negatively impacted.

The pet food product category in which we participate is highly competitive. If we are unable to compete effectively, our results of operations could be adversely affected.

The pet food product category in which we participate is highly competitive. There are numerous brands and products that compete for shelf space and sales, with competition based primarily upon brand recognition and loyalty, product packaging, quality and innovation, taste, nutrition, breadth of product line, price and convenience. We compete with a significant number of companies of varying sizes, including divisions or subsidiaries of larger companies. We face strong competition from competitors’ products that are sometimes sold at lower prices. Price gaps between our products and our competitors’ products may result in market share erosion and harm our business. A number of our competitors have broader product lines, substantially greater financial and other resources and/or lower fixed costs than we have. Our competitors may succeed in developing new or enhanced products, including fresh, refrigerated pet food, that are more attractive to customers or consumers than our products. These competitors may also prove to be more successful in marketing and selling their products or may be better able to increase prices to reflect cost pressures. We may not compete successfully with these other companies or maintain or grow the distribution of our products. We cannot predict the pricing or promotional activities of our competitors or whether they will have a negative effect on us. Many of our competitors engage in aggressive pricing and promotional activities. There are competitive pressures and other factors which could cause our products to lose market share or decline in sales or result in significant price or margin erosion, which would have a material adverse effect on our business, financial condition and results of operations.

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If the operating capacity or reputation of our Freshpet Fridges is harmed, our business, financial condition and results of operations may suffer.

Our success depends on our network of company-owned branded refrigerators, known as Freshpet Fridges. If the operating capacity of our Freshpet Fridges is harmed by external factors, such as adverse weather or energy supply, or internal factors, such as faulty manufacturing or insufficient maintenance, our products contained in those fridges may be damaged and need to be discarded. In addition, if our Freshpet Fridges fail to operate as intended, for any reason, the reputation of our Freshpet Fridges with customers and the reputation of our brand with consumers may decline. In such event, customers may choose to discontinue, or not to expand, their use of Freshpet Fridges and our products and consumers may choose to forgo purchasing our products. Additionally, growing concern about the environmental impact of refrigerators could likewise harm the reputation of our Freshpet Fridges with customers and our brand with consumers. Any such harm to the operating capacity or reputation of our Freshpet Fridges could adversely affect our business, financial condition and results of operations.

If we are not successful in protecting our intellectual property rights, our business, financial conditions and results of operations may be harmed.

We rely on trademark, copyright, trade secret, patent and other intellectual property laws, as well as nondisclosure and confidentiality agreements and other methods, to protect our intellectual property rights as well as the intellectual property of third parties with respect to which we are subject to non-use and non-disclosure obligations. We may need to engage in litigation or similar activities to enforce our intellectual property rights, to protect our trade secrets or to determine the validity and scope of proprietary rights of others. Any such litigation could require us to expend significant resources and divert the efforts and attention of our management and other personnel from our business operations. The steps we take to prevent misappropriation, infringement or other violation of our intellectual property or the intellectual property of others may not be successful. In addition, effective patent, copyright, trademark and trade secret protection may be unavailable or limited for some of our trademarks and patents in some foreign countries. Failure to protect our intellectual property could harm our business, financial condition and results of operations.

Our brand names and trademarks are important to our business, and we have registered or applied to register many of these trademarks. We cannot assure you that our trademark applications will be approved. Third parties may also oppose our trademark applications, or otherwise challenge our use of the trademarks. In the event that our trademarks are successfully challenged, we could be forced to rebrand our products, which could result in the loss of brand recognition and could require us to devote resources advertising and marketing new brands. Further, we cannot assure you that competitors will not infringe our trademarks, or that we will have adequate resources to enforce our trademarks.

We rely on unpatented proprietary know-how in the areas of recipes, ingredients sourcing, cooking techniques, packaging, transportation and delivery. It is possible that others will independently develop the same or similar know-how or otherwise obtain access to our proprietary know-how. To protect our trade secrets and other proprietary know-how, we require employees, consultants, advisors and collaborators to enter into confidentiality agreements. We cannot assure you that these agreements will provide meaningful protection in the event of any unauthorized use, misappropriation or disclosure of our trade secrets, know-how or other proprietary information. If we are unable to maintain the proprietary nature of our recipes, methods and other know-how, we could be materially adversely affected.

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We may not be able to successfully implement initiatives to improve productivity and streamline operations to control or reduce costs. Failure to implement such initiatives could adversely affect our results of operations.

Because our ability to effectively implement price increases for our products can be affected by factors outside of our control, our profitability and growth depend significantly on our efforts to control our operating costs. Because many of our costs, such as energy and logistics costs, packaging costs and ingredient, commodity and raw product costs, are affected by factors outside or substantially outside our control, we generally must seek to control or reduce costs through operating efficiency or other initiatives. If we are not able to identify and complete initiatives designed to control or reduce costs and increase operating efficiency on time or within budget, our results of operations could be adversely impacted. In addition, if the cost savings initiatives we have implemented to date, or any future cost-savings initiatives, do not generate expected cost savings, our business, financial condition and results of operations could be adversely affected.

The inputs, commodities, and ingredients that we require are subject to price increases and shortages that could adversely affect our results of operations.

The primary inputs, commodities, and ingredients that we use include meat, vegetables, fruits, carrageenans, whole grains, vitamins, minerals, packaging and energy (including wind power). Prices for these and other items we use may be volatile, and we may experience shortages in these items due to factors beyond our control, such as commodity market fluctuations, availability of supply, increased demand (whether for the item we require or for other items, which in turn impacts the item we require), weather conditions, natural disasters, currency fluctuations, governmental regulations (including import restrictions), agricultural programs or issues, energy programs, labor strikes and the financial health of our suppliers. Input, commodity, and ingredient price increases or shortages may result in higher costs or interrupt our production schedules, each of which could have a material adverse effect on our results of operations. Production delays could lead to reduced sales volumes and profitability as well as loss of market share. Higher costs could adversely impact our earnings. For example, fuel prices affect our transportation costs for both ingredients and finished product. If we are not able to implement our productivity initiatives or increase our product prices to offset price increases of our inputs, commodities, and ingredients, as a result of consumer sensitivity to pricing or otherwise, or if sales volumes decline due to price increases, our results of operations could be adversely affected. Our competitors may be better able than we are to implement productivity initiatives or effect price increases or to otherwise pass along cost increases to their customers. Moreover, if we increase our prices in response to increased costs, we may need to increase marketing spending, including trade promotion spending, in order to retain our market share. Such increased marketing spending may significantly offset the benefits, if any, of any price increase and negatively impact our business, financial condition and results of operations.

If the ingredients we use in our products are contaminated, alleged to be contaminated or are otherwise rumored to have adverse effects, our results of operations could be adversely affected.

We buy our ingredients from third-party suppliers. If these materials are alleged or prove to include contaminants that affect the safety or quality of our products or are otherwise rumored to have adverse effects, for any reason, we may need to find alternate ingredients for our products, delay production of our products, or discard or otherwise dispose of our products, which could adversely affect our results of operations. Additionally, if this occurs after the affected product has been distributed, we may need to withdraw or recall the affected product and we may experience adverse publicity or product liability claims. In either case, our business, financial condition and results of operations could be adversely affected.

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Restrictions imposed in reaction to outbreaks of animal diseases could have a material adverse effect on our business, financial condition and results of operations.

The cost of the protein-based ingredients we use in our products has been adversely impacted in the past by the publicity surrounding animal diseases, such as bovine spongiform encephalopathy, or “mad cow disease.” As a result of extensive global publicity and trade restrictions imposed to provide safeguards against mad cow disease, the cost of alternative sources of the protein-based ingredients we use in our products, such as soybeans, pork meat and bone meal, has from time to time increased significantly and may increase again in the future if additional cases of mad cow disease are found.

If mad cow disease or other animal diseases, such as foot-and-mouth disease or highly pathogenic avian influenza, also known as “bird flu,” impacts the availability of the protein-based ingredients we use in our products, we may be required to locate alternative sources for protein-based ingredients. Those sources may not be available to sustain our sales volumes, may be more costly and may affect the quality and nutritional value of our products. If outbreaks of mad cow disease, foot-and-mouth disease, bird flu or any other animal disease or the regulation or publicity resulting therefrom impacts the cost of the protein-based ingredients we use in our products, or the cost of the alternative protein-based ingredients necessary for our products as compared to our current costs, we may be required to increase the selling price of our products to avoid margin deterioration. However, we may not be able to charge higher prices for our products without negatively impacting future sales volumes.

We rely on co-packers to provide our supply of treat products. Any failure by co-packers to fulfill their obligations or any termination or renegotiation of our co-packing agreements could adversely affect our results of operations.

We have supply agreements with co-packers that require them to provide us with specific finished products. We rely on co-packers as our sole-source for treat products. We also anticipate that we will rely on sole suppliers for future products. The failure for any reason of a co-packer to fulfill its obligations under the applicable agreements with us or the termination or renegotiation of any such co-packing agreement could result in disruptions to our supply of finished goods and have an adverse effect on our results of operations. Additionally, from time to time, a co-packer may experience financial difficulties, bankruptcy or other business disruptions, which could disrupt our supply of finished goods or require that we incur additional expense by providing financial accommodations to the co-packer or taking other steps to seek to minimize or avoid supply disruption, such as establishing a new co-packing arrangement with another provider. During an economic downturn, our co-packers may be more susceptible to experiencing such financial difficulties, bankruptcies or other business disruptions. A new co-packing arrangement may not be available on terms as favorable to us as the existing co-packing arrangement, if at all.

If we do not manage our supply chain effectively, including inventory levels, our business, financial condition and results of operation may be adversely affected.

The inability of any supplier, co-packer, third-party distributor or transportation provider to deliver or perform for us in a timely or cost-effective manner could cause our operating costs to increase and our profit margins to decrease. We must continuously monitor our inventory and product mix against forecasted demand or risk having inadequate supplies to meet consumer demand as well as having too much inventory on hand that may reach its expiration date and become unsaleable. If we are unable to manage our supply chain effectively and ensure that our products are available to meet consumer demand, our operating costs could increase and our profit margins could decrease.

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Failure by our transportation providers to deliver our products on time or at all could result in lost sales.

We use third-party transportation providers for our product shipments. We rely on one such provider for almost all of our shipments. Transportation services include scheduling and coordinating transportation of finished products to our customers, shipment tracking and freight dispatch services. Our use of transportation services for shipments is subject to risks, including increases in fuel prices, which would increase our shipping costs, and employee strikes and inclement weather, which may impact the ability of providers to provide delivery services that adequately meet our shipping needs, including keeping our products adequately refrigerated during shipment. Any such change could cause us to incur costs and expend resources. Moreover, in the future we may not be able to obtain terms as favorable as those we receive from the third-party transportation providers that we currently use, which in turn would increase our costs and thereby adversely affect our business, financial condition and results of operations.

If we are unable to maintain or increase prices for our products, our results of operations may be adversely affected.

We rely in part on price increases to neutralize cost increases and improve the profitability of our business. Our ability to effectively implement price increases or otherwise raise prices for our products can be affected by a number of factors, including competition, our competitors’ pricing and marketing, aggregate industry supply, category limitations, market demand and economic conditions, including inflationary pressures. During challenging economic times, our ability to increase the prices of our products may be particularly constrained. Additionally, customers may pressure us to rescind price increases that we have announced or already implemented (either through a change in list price or increased promotional activity). If we are unable to maintain or increase prices for our products (or must increase promotional activity), our results of operations could be adversely affected. Furthermore, price increases generally result in volume losses, as consumers purchase fewer units. If such losses (also referred to as the elasticity impact) are greater than expected or if we lose distribution due to a price increase (which may result from a customer response or otherwise), our business, financial condition and results of operations could be adversely affected.

We may face difficulties as we expand into countries in which we have no prior operating experience.

We may choose to expand our global footprint by entering into new markets. As we expand our business into new countries we may encounter regulatory, personnel, technological and other difficulties that increase our expenses or delay our ability to become profitable in such countries. This may have an adverse effect on our business.

If we are unable to attract, train and retain employees, we may not be able to grow or successfully operate our business.

Our success depends in part upon our ability to attract, train and retain a sufficient number of employees who understand and appreciate our culture and are able to represent our brand effectively and establish credibility with our business partners and consumers. If we are unable to hire and retain employees capable of meeting our business needs and expectations, our business and brand image may be impaired. Any failure to meet our staffing needs or any material increase in turnover rates of our employees may adversely affect our business, financial condition and results of operations.

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Unionization activities or labor disputes may disrupt our operations and affect our profitability.

Although none of our employees are currently covered under collective bargaining agreements, our employees may elect to be represented by labor unions in the future. If a significant number of our employees were to become unionized and collective bargaining agreement terms were significantly different from our current compensation arrangements, it could adversely affect our business, financial condition and results of operations. In addition, a labor dispute involving some or all of our employees may harm our reputation, disrupt our operations and reduce our revenues, and resolution of disputes may increase our costs.

As an employer, we may be subject to various employment-related claims, such as individual or class actions or government enforcement actions relating to alleged employment discrimination, employee classification and related withholding, wage-hour, labor standards or healthcare and benefit issues. Such actions, if brought against us and successful in whole or in part, may affect our ability to compete or could materially adversely affect our business, financial condition and results of operations.

Disruptions in the worldwide economy may adversely affect our business, results of operations and financial condition.

Adverse and uncertain economic conditions may impact distributor, customer and consumer demand for our products. In addition, our ability to manage normal commercial relationships with our suppliers, contract manufacturers, distributors, customers, consumers and creditors may suffer. Consumers have access to lower-priced offerings and, during economic downturns, may shift purchases to these lower-priced or other perceived value offerings. Customers may become more conservative in response to these conditions and seek to reduce their inventories. For example, during the economic downturn from 2007 through 2009, customers significantly reduced their inventories, and inventory levels have not returned to, and are not expected to return to, pre-downturn levels. Our results of operations depend upon, among other things, our ability to maintain and increase sales volume with our existing customers, to attract new consumers and to provide products that appeal to consumers at prices they are willing and able to pay. Prolonged unfavorable economic conditions may have an adverse effect on our sales and profitability.

We are subject to environmental regulation and environmental risks, which may adversely affect our business. Climate change or concerns regarding climate change may increase environmental regulation and environmental risks.

As a result of our agricultural and food processing operations, we are subject to numerous environmental laws and regulations. Many of these laws and regulations are becoming increasingly stringent and compliance with them is becoming increasingly expensive. Changes in environmental conditions may result in existing legislation having a greater impact on us. Additionally, we may be subject to new legislation and regulation in the future. For example, increasing concern about climate change may result in additional federal and state legal and regulatory requirements to reduce or mitigate the effects of green-house gas emissions. Compliance with environmental legislation and regulations, particularly if they are more aggressive than our current sustainability measures used to monitor our emissions and improve our energy efficiency, may increase our costs and adversely affect our results of operations. We cannot predict the extent to which any environmental law or regulation that may be enacted or enforced in the future may affect our operations. The effect of these actions and future actions on the availability and use of pesticides could adversely impact our financial position or results of operations. If the cost of compliance with applicable environmental laws or regulations increases, our business, financial condition and results of operations could be negatively impacted.

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Intellectual property infringement or violation claims may adversely impact our results of operations.

We may be subject to claims by others that we infringe on their intellectual property or otherwise violate their intellectual property rights. To the extent we develop, introduce and acquire products, the risk of such claims may be exacerbated. Any such claims, even those without merit, could (i) require us to expend significant resources, (ii) cause us to cease making or using products that incorporate the challenged intellectual property, (iii) require us to redesign, reengineer or rebrand our products or packaging, including our Freshpet Fridges located in over 12,500 retail stores, (iv) divert management’s attention and resources or (v) require us to enter into royalty or licensing agreements in order to obtain the right to use a third party’s intellectual property, which may not be available to us on acceptable terms or at all. Any of such events may adversely impact our business, financial condition and results of operations.

Our business operations could be disrupted if our information technology systems fail to perform adequately.

The efficient operation of our business depends on our information technology systems, some of which are managed by third-party service providers. We rely on our information technology systems to effectively manage our business data, communications, supply chain, order entry and fulfillment, and other business processes. The failure of our information technology systems to perform as we anticipate could disrupt our business and could result in transaction errors, processing inefficiencies, and the loss of sales and customers, causing our business and results of operations to suffer. In addition, our information technology systems may be vulnerable to damage or interruption from circumstances beyond our control, including fire, natural disasters, power outages, systems failures, security breaches, cyber attacks and viruses. Any such damage or interruption could have a material adverse effect on our business, financial condition and results of operations.

We are subject to cyber security risks and may incur increasing costs in an effort to minimize those risks.

Our business employs systems and websites that allow for the secure storage and transmission of proprietary or confidential information regarding our customers, employees, suppliers and others, including personal identification information. Security breaches could expose us to a risk of loss or misuse of this information, litigation, and potential liability. We may not have the resources or technical sophistication to anticipate or prevent rapidly-evolving types of cyber attacks. Attacks may be targeted at us, our customers and suppliers, or others who have entrusted us with information. Actual or anticipated attacks may cause us to incur increasing costs, including costs to deploy additional personnel and protection technologies, train employees, and engage third-party experts and consultants. Advances in computer capabilities, new technological discoveries, or other developments may result in the technology used by us to protect transaction or other data being breached or compromised. In addition, data and security breaches can also occur as a result of non-technical issues, including breach by us or by persons with whom we have commercial relationships that result in the unauthorized release of personal or confidential information. Any compromise or breach of our security could result in a violation of applicable privacy and other laws, significant legal and financial exposure, and a loss of confidence in our security measures, which could have an adverse effect on our business, financial condition and results of operations.

Our indebtedness could adversely affect our business and results of operations.

In 2013, we borrowed approximately $32.0 million under our Revolving Note Payable (as defined herein). As of June 30, 2014, we had approximately $82.5 million outstanding under our Revolving Note Payable with no additional borrowing availability. As of June 30, 2014, on a pro forma basis, after

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giving effect to the application of the net proceeds received from this offering as described under “Use of Proceeds,” we had approximately $         million outstanding under our Revolving Note Payable with additional borrowing availability of $         million. Subject to the limitations contained in the credit agreements governing our Revolving Note Payable, we may be able to incur substantial additional indebtedness from time to time to finance working capital, capital expenditures, investments or acquisitions, or for other purposes. If we do so, the risks related to our level of indebtedness, if any, could intensify. Specifically, our level of indebtedness could have important consequences, including:

• requiring a substantial portion of our cash flow to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flow available for working capital, capital expenditures, acquisitions and other general corporate purposes;

• increasing our vulnerability to adverse changes in general economic, industry and competitive conditions;

• exposing us to the risk of increased interest rates as borrowings under the credit facility will be at variable rates of interest;

• limiting our flexibility in planning for and reacting to changes in the industry in which we compete;

• limiting our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements;

• placing us at a disadvantage compared to other, less leveraged competitors or competitors with comparable debt at more favorable interest rates; and

• increasing our cost of borrowing.

If we are unable to substantially utilize our net operating loss carryforward, our financial results will be adversely affected.

As of December 31, 2013, we had federal net operating loss (“NOLs”) carryforwards of approximately $132.0 million and state NOLs of approximately $124.1 million. In general, a corporation that undergoes an ‘‘ownership change’’ is subject to limitations on its ability to utilize its pre-change NOLs, to offset future taxable income. In general, under the U.S. Internal Revenue Code of 1986, as amended (the “Code”), an ownership change occurs if the aggregate stock ownership of certain stockholders (generally 5% stockholders, applying certain look-through and aggregation rules) increases by more than 50 percentage points over such stockholders’ lowest percentage ownership during the testing period (generally three years). Purchases of our common stock in amounts greater than specified levels, which will be beyond our control, could create a limitation on our ability to utilize our NOLs for tax purposes in the future. Limitations imposed on our ability to utilize NOLs could cause U.S. federal and state income taxes to be paid earlier than would be paid if such limitations were not in effect and could cause such NOLs to expire unused, in each case reducing or eliminating the benefit of such NOLs. Furthermore, we may not be able to generate sufficient taxable income to utilize our NOLs before they expire. If any of these events occur, we may not derive some or all of the expected benefits from our NOLs. In addition, NOLs incurred in one state may not be available to offset income earned in a different state. Furthermore, there may be periods during which the use of NOLs is suspended or otherwise limited for state tax purposes, which could accelerate or permanently increase state taxes owed.

Failure to establish and maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our business and stock price.

We are not currently required to comply with the rules of the SEC implementing Section 404 of the Sarbanes-Oxley Act and therefore are not required to make a formal assessment of the

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effectiveness of our internal control over financial reporting for that purpose. Upon becoming a publicly traded company, we will be required to comply with the SEC’s rules implementing Section 302 and 404 of the Sarbanes-Oxley Act, which will require management to certify financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness of controls over financial reporting. Though we will be required to disclose changes made in our internal controls and procedures on a quarterly basis, we will not be required to make our first annual assessment of our internal control over financial reporting pursuant to Section 404 until the year following our first annual report required to be filed with the SEC. Pursuant to the JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting until the later of the year following our first annual report required to be filed with the SEC or the date we are no longer an emerging growth company, which may be up to five full fiscal years following this offering.

To comply with the requirements of being a public company, we may need to undertake various actions, such as implementing new internal controls and procedures and hiring additional staff. In addition, we may identify material weaknesses in our internal control over financial reporting that we may not be able to remediate in time to meet the applicable deadline imposed upon us for compliance with the requirements of Section 404. If we identify weaknesses in our internal control over financial reporting, are unable to comply with the requirements of Section 404 in a timely manner or to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock could be negatively affected, and we could become subject to investigations by the                     on which our securities are listed, the SEC or other regulatory authorities, which could require additional financial and management resources.

Risks Related to Ownership of Our Common Stock

There is no existing market for our common stock, and we do not know if one will develop. Even if a market does develop, the stock prices in the market may not exceed the offering price.

Prior to this offering, there has not been a public market for our common stock or any of our equity interests. We cannot predict the extent to which investor interest in our company will lead to the development of an active trading market on the                     , or how liquid that market may become. An active public market for our common stock may not develop or be sustained after the offering. If an active trading market does not develop or is not sustained, you may have difficulty selling any shares that you buy.

The initial public offering price for the common stock was determined by negotiations among us and the representatives of the underwriters and may not be indicative of prices that will prevail in the open market following this offering. Consequently, you may not be able to sell shares of our common stock at prices equal to or greater than the price you pay in this offering.

Our quarterly operating results may fluctuate significantly and could fall below the expectations of securities analysts and investors due to seasonality and other factors, some of which are beyond our control, resulting in a decline in our stock price.

Our quarterly operating results may fluctuate significantly because of several factors, including:

• the timing of installation of new Freshpet Fridges and related expenses;

• profitability of our Freshpet Fridges, especially in new markets;

• changes in interest rates;

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• impairment of long-lived assets;

• macroeconomic conditions, both nationally and locally;

• negative publicity relating to the consumption of products we serve;

• changes in consumer preferences and competitive conditions;

• expansion to new markets;

• increases in infrastructure costs; and

• fluctuations in commodity prices.

As a result of these factors, our quarterly and annual operating results may fluctuate significantly. Accordingly, results for any one quarter are not necessarily indicative of results to be expected for any other quarter or for any year for any particular future period may decrease. In the future, operating results may fall below the expectations of securities analysts and investors. In that event, the price of our common stock would likely decrease.

The price of our common stock may be volatile and you may lose all or part of your investment.

The market price of our common stock could fluctuate significantly, and you may not be able to resell your shares at or above the offering price. Those fluctuations could be based on various factors in addition to those otherwise described in this prospectus, including those described under “—Risks Related to Our Business and Industry” and the following:

• our operating performance and the performance of our competitors or petfood companies in general;

• the public’s reaction to our press releases, our other public announcements and our filings with the SEC;

• changes in earnings estimates or recommendations by research analysts who follow us or other companies in our industry;

• global, national or local economic, legal and regulatory factors unrelated to our performance;

• the number of shares to be publicly traded after this offering;

• future sales of our common stock by our officers, directors and significant stockholders;

• the arrival or departure of key personnel; and

• other developments affecting us, our industry or our competitors.

In addition, in recent years the stock market has experienced significant price and volume fluctuations. These fluctuations may be unrelated to the operating performance of particular companies. These broad market fluctuations may cause declines in the market price of our common stock. The price of our common stock could fluctuate based upon factors that have little or nothing to do with our business, financial condition and results of operations, and those fluctuations could materially reduce our common stock price.

As we operate in a single industry, we are especially vulnerable to these factors to the extent that they affect our industry or our products. In the past, securities class action litigation has often been initiated against companies following periods of volatility in their stock price. This type of litigation could result in substantial costs and divert our management’s attention and resources, and could also require us to make substantial payments to satisfy judgments or to settle litigation.

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Future sales of our common stock, or the perception that such sales may occur, could depress our common stock price.

We, our officers, directors and holders of all or substantially all our outstanding capital stock have agreed, subject to specified exceptions, not to dispose of or hedge any of our common stock for a certain period of time beginning on the date of this prospectus. However, Goldman, Sachs & Co. and Credit Suisse Securities (USA) LLC, on behalf of the underwriters, may release all or any portion of the shares subject to the lock-up prior to the expiration of the restricted period and, in any event, the restricted period ends 180 days after the date of this prospectus. See “Underwriting.”

Furthermore, our Certificate of Incorporation that will be in effect immediately prior to the completion of this offering authorizes us to issue up to              shares of common stock, of which              shares will be outstanding immediately following completion of this offering, assuming the underwriters’ option to purchase additional shares of our common stock is not exercised, and              shares will be issuable upon the exercise of stock options with an exercise price equal to the initial public offering price to be issued to certain officers, directors, employees and consultants. All of our outstanding shares will be freely tradable after the expiration date of the lock-up agreements, except for any shares held or acquired by persons who may be deemed to be our affiliates.

In addition, immediately following this offering, we intend to file a registration statement registering under the Securities Act the shares of common stock reserved for issuance under our 2014 Plan. See the information under the heading “Shares Eligible for Future Sale” for a more detailed description of the shares that will be available for future sales upon completion of this offering.

In the future, we may also issue common stock or other securities if we need to raise additional capital. The number of new shares of our common stock issued in connection with raising additional capital could constitute a material portion of the then outstanding shares of our common stock. Any future sales of our common stock, or the perception that such sales may occur, could negatively impact the price of our common stock.

If you purchase shares of our common stock sold in this offering, you will incur immediate and substantial dilution.

If you purchase shares of our common stock in this offering, you will incur immediate and substantial dilution in the amount of $         per share, because the initial public offering price of $         per share is substantially higher than the pro forma as adjusted net tangible book value per share of our outstanding common stock. This dilution is due in large part to the fact that our earlier investors paid substantially less than the initial public offering price when they purchased their shares. In addition, you may also experience additional dilution upon future equity issuances or the exercise of stock options to purchase common stock granted to our employees, and directors under our stock option and equity incentive plans. Half of such stock options will vest immediately upon the completion of this offering and the remainder will vest in four equal annual installments following the date of the grant. See “Dilution.”

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.

The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. We do not currently have and may never obtain research coverage by securities and industry analysts. If no securities or industry analysts commence coverage of our Company, the trading price for our common stock would be negatively impacted. If we obtain securities or industry analyst coverage and if one or more of the analysts who cover us downgrades our common stock or publishes inaccurate or unfavorable research about our

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business, our stock price would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for our common stock could decrease, which could cause our stock prices and trading volume to decline.

Our principal stockholders and their affiliates own a substantial portion of our outstanding equity, and their interests may not always coincide with the interests of the other holders.

Immediately following the consummation of this offering, MidOcean and Freshpet Investors LLC will own approximately         % and         %, respectively, of our common stock, or         % and         %, respectively, if the underwriters’ option to purchase additional shares of our common stock is exercised in full. As a result, MidOcean and Freshpet Investors LLC could potentially have significant influence over all matters presented to our stockholders for approval, including election and removal of our directors, change in control transactions and the outcome of all actions requiring a majority stockholder approval.

In addition, persons associated with MidOcean and Freshpet Investors LLC currently serve on our Board of Directors. Following this offering, the interests of MidOcean and Freshpet Investors LLC may not always coincide with the interests of the other holders of our common stock, and the concentration of control in MidOcean and Freshpet Investors LLC will limit other stockholders’ ability to influence corporate matters. The concentration of ownership and voting power of MidOcean and Freshpet Investors LLC may also delay, defer or even prevent an acquisition by a third party or other change of control of our Company and may make some transactions more difficult or impossible without their support, even if such events are in the best interests of our other stockholders. Therefore, the concentration of voting power among MidOcean and Freshpet Investors LLC may have an adverse effect on the price of our common stock. We may also take actions that our other stockholders do not view as beneficial, which may adversely affect our results of operations and financial condition and cause the value of your investment to decline.

We do not intend to pay dividends for the foreseeable future.

We may retain future earnings, if any, for future operations, expansion and debt repayment and have no current plans to pay any cash dividends for the foreseeable future. Any future determination to declare and pay cash dividends will be at the discretion of our Board of Directors and will depend on, among other things, our financial condition, results of operations, cash requirements, contractual restrictions and such other factors as our Board of Directors deems relevant. Our ability to pay dividends may also be limited by covenants of any future outstanding indebtedness we or our subsidiaries incur. As a result, you may not receive any return on an investment in our common stock unless you sell our common stock for a price greater than that which you paid for it. See “Dividend Policy.”

Provisions in our charter documents and Delaware law may delay or prevent our acquisition by a third party, even if the acquisition would be beneficial to our stockholders, and could make it more difficult for you to change our management.

Our Certificate of Incorporation and Bylaws that will be in effect immediately prior to the completion of this offering, and Delaware law, contain several provisions that may make it more difficult for a third party to acquire control of us without the approval of our Board of Directors. For example, we will have a classified Board of Directors with three-year staggered terms, which could delay the ability of stockholders to change membership of a majority of our Board of Directors. These provisions may make it more difficult or expensive for a third party to acquire a majority of our outstanding equity interests. These provisions also may delay, prevent or deter a merger, acquisition, tender offer, proxy contest or other transaction that might otherwise result in our stockholders receiving a premium over the market price for their common stock. See “Description of Capital Stock.”

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Under our Certificate of Incorporation, individuals or entities that bring certain claims or join such claims may be obligated to reimburse the Company for the expenses it reasonably incurs in connection with such actions if the claim proves unsuccessful.

Our Certificate of Incorporation will provide, to the fullest extent permitted by law, in the event that any person or entity (the “Claimant”) (x) initiates or asserts (1) any derivative action or proceeding brought on behalf of the Company, (2) any claim of breach of a fiduciary duty owed by any director, officer, employee or agent of the Company to the Company or its stockholders, (3) any action against the Company or any of its directors, officers, employees or agents arising pursuant to any provision of the General Corporation Law of the State of Delaware, our Certificate of Incorporation or our Bylaws, or (4) any action asserting a claim governed by the internal affairs doctrine (each of the foregoing, a “Claim”), or joins any such Claim as a named party, and (y) does not thereby obtain a judgment on the merits that substantially achieves the full remedy or relief sought in the Claim, such Claimant shall be jointly and severally obligated to reimburse the Company for all fees, costs and expenses (including attorneys’ fees and the fees of experts) actually and reasonably incurred by the Company in defending such Claim. This provision of our Certificate of Incorporation may deter stockholder litigation that may be in the best interests of the Company or our stockholders.

We are an emerging growth company and, as a result of the reduced disclosure and governance requirements applicable to emerging growth companies, our common stock may be less attractive to investors.

We are an emerging growth company, as defined in the JOBS Act, and we are eligible to take advantage of certain exemptions from various reporting requirements applicable to other public companies, but not to emerging growth companies, including, but not limited to, an exemption from the auditor attestation requirement of Section 404 of the Sarbanes-Oxley Act, reduced disclosure about executive compensation arrangements pursuant to the rules applicable to smaller reporting companies and no requirement to seek non-binding advisory votes on executive compensation or golden parachute arrangements. We will remain an emerging growth company until the earliest of (i) the end of the fiscal year following the fifth anniversary of the completion of this offering, (ii) the first fiscal year after our annual gross revenue are $1.0 billion or more, (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities or (iv) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year.

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. However, we are choosing to “opt out” of such extended transition period and, as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

We cannot predict if investors will find our common stock less attractive as a result of our taking advantage of these exemptions. If some investors find our common stock less attractive as a result of our choices, there may be a less active trading market for our common stock and our stock price may be more volatile.

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Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.

Our Certificate of Incorporation and Bylaws that will be in effect immediately prior to the completion of this offering provide that we will indemnify our directors and officers, in each case to the fullest extent permitted by Delaware law. In addition, we have entered and expect to continue to enter into agreements to indemnify our directors, executive officers and other employees as determined by our Board of Directors. Upon the consummation of this offering, we will enter into indemnification agreements with our director nominees and amended indemnification agreements with each of our directors and officers. Under the terms of such indemnification agreements, we are required to indemnify each of our directors and officers, to the fullest extent permitted by the laws of the state of Delaware, if the basis of the indemnitee’s involvement was by reason of the fact that the indemnitee is or was a director or officer of the Company or any of its subsidiaries or was serving at the Company’s request in an official capacity for another entity. We must indemnify our officers and directors against all reasonable fees, expenses, charges and other costs of any type or nature whatsoever, including any and all expenses and obligations paid or incurred in connection with investigating, defending, being a witness in, participating in (including on appeal), or preparing to defend, be a witness or participate in any completed, actual, pending or threatened action, suit, claim or proceeding, whether civil, criminal, administrative or investigative, or establishing or enforcing a right to indemnification under the indemnification agreement. The indemnification agreements also require us, if so requested, to advance within 30 days of such request all reasonable fees, expenses, charges and other costs that such director or officer incurred, provided that such person will return any such advance if it is ultimately determined that such person is not entitled to indemnification by us. Any claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.

Future offerings of debt securities, which would rank senior to our common stock upon our bankruptcy or liquidation, and future offerings of equity securities that may be senior to our common stock for the purposes of dividend and liquidating distributions, may adversely affect the market price of our common stock.

In the future, we may attempt to increase our capital resources by making offerings of debt securities or additional offerings of equity securities. Upon bankruptcy or liquidation, holders of our debt securities and shares of preferred stock and lenders with respect to other borrowings will receive a distribution of our available assets prior to the holders of our common stock. Additional equity offerings may dilute the holdings of our existing stockholders or reduce the market price of our common stock, or both, and may result in future Section 382 limitations that could reduce the rate at which we utilize our NOL carryforwards. Preferred stock, if issued, could have a preference on liquidating distributions or a preference on dividend payments or both that could limit our ability to make a dividend distribution to the holders of our common stock. Our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control. As a result, we cannot predict or estimate the amount, timing or nature of our future offerings, and purchasers of our common stock in this offering bear the risk of our future offerings reducing the market price of our common stock and diluting their ownership interest in our company.

We have broad discretion to use the proceeds from the offering and our investment of those proceeds may not yield favorable returns.

We intend to use approximately $         million of the net proceeds from this offering to repay our Indebtedness, to effect the Preferred Stock Redemption and to support our growth, primarily through installing new Freshpet Fridges and adding manufacturing capacity. Our management has broad discretion to spend the remainder of the net proceeds from this offering and you may not agree with the way the net proceeds are spent. The failure of our management to apply these funds effectively could result in unfavorable returns. This could adversely affect our business, causing the price of our common stock to decline.

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FORWARD-LOOKING STATEMENTS

This prospectus contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical fact included in this prospectus are forward-looking statements. Forward-looking statements discuss our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “outlook,” “potential,” “project,” “projection,” “plan,” “intend,” “seek,” “may,” “could,” “would,” “will,” “should,” “can,” “can have,” “likely,” the negatives thereof and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. They appear in a number of places throughout this prospectus and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which we operate. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected, including:

• our ability to successfully implement our growth;

• our ability to generate sufficient cash flow or raise capital on acceptable terms;

• the loss of key members of our senior management team;

• allegations that our products cause injury or illness or fail to comply with government regulations;

• the loss of a significant customer;

• the effectiveness of our marketing and trade spending programs;

• our ability to introduce new products and improve existing products;

• our limited manufacturing capacity;

• the impact of government regulation, scrutiny, warning and public perception;

• the effect of false marketing claims;

• adverse weather conditions, natural disasters, pestilences and other natural conditions affecting our operations;

• our ability to develop and maintain our brand;

• volatility in the price of our common stock; and

• other factors discussed under the headings “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Business.”

While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are disclosed under “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this prospectus. All forward-looking statements are expressly qualified in their entirety by these cautionary statements. You should evaluate all forward-looking statements made in this prospectus in the context of these risks and uncertainties.

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We caution you that the important factors referenced above may not contain all of the factors that are important to you. In addition, we cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences we anticipate or affect us or our operations in the way we expect. The forward-looking statements included in this prospectus are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements. We qualify all of our forward-looking statements by these cautionary statements.

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USE OF PROCEEDS

We estimate that the net proceeds to us from this offering, after deducting the underwriting discount and estimated offering expenses payable by us, will be approximately $         million, or $         million if the underwriters’ option to purchase additional shares of our common stock is exercised in full.

We intend to use the net proceeds from the sale of common stock by us in this offering:

(i) to repay our Indebtedness (as defined below) and to effect the Preferred Stock Redemption;

(ii) to support our growth, primarily through installing new Freshpet Fridges and adding manufacturing capacity; and

(iii) for working capital and general corporate purposes.

We have a $20.0 million revolving payable note (the “$20 Million Revolver”), which matures on October 31, 2015. The borrowings bear interest at either a LIBOR Rate plus 8% margin or a Base Rate plus 6%, depending on our election. Borrowings on this note payable totaled $20.0 million at June 30, 2014.

We also have a $62.5 million revolving payable note (the “$62.5 Million Revolver”), which matures on May 1, 2016. Subject to certain conditions, the maturity date may be extended until May 1, 2017. The $62.5 Million Revolver bears interest at either a LIBOR Rate (LIBOR Adjusted Rate plus 3.25%) or a Base Rate (Base Rate plus 2.25%). Monthly, LIBOR Rate loans are payable at the end of the selected interest rate. Borrowings on the $62.5 Million Revolver totaled $62.5 million at June 30, 2014. We refer to the $20 Million Revolver and the $62.5 Million Revolver as our “Revolving Note Payable.”

We also have a $1.5 million note issued to certain stockholders (the “Stockholder Note”). The Stockholder Note accrues interest compounded annually at a rate of 10%. The Stockholder Note and all accrued interest are due on December 23, 2020. We refer to the $20 Million Revolver, the $62.5 Million Revolver and the Stockholder Note as our “Indebtedness.” In addition, we have 112,160 shares of Series B Preferred Stock outstanding, which we expect to redeem for an aggregate purchase price of $                         following this offering.

We intend to use approximately $         million of the net proceeds we receive from this offering to repay our Indebtedness and to effect the Preferred Stock Redemption. We also intend to use approximately $         million of the net proceeds we receive from this offering to support our growth, primarily through installing new Freshpet Fridges and adding manufacturing capacity. We intend to use any remaining net proceeds we receive from this offering for working capital and general corporate purposes.

Pending use of the net proceeds from this offering as described above, we may invest the net proceeds in short and intermediate term interest bearing obligations, investment grade instruments, certificates of deposit or direct or guaranteed obligations of the United States government.

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DIVIDEND POLICY

We have not declared any dividends on our common stock. We currently intend to retain all available funds and any future earnings to fund the development and growth of our business and to repay indebtedness, and therefore we do not anticipate paying any cash dividends in the foreseeable future. Additionally, our ability to pay dividends on our common stock will be limited by restrictions on the ability of our subsidiaries and us to pay dividends or make distributions under the terms of current and any future agreements governing our indebtedness. Any future determination to declare and pay cash dividends will be at the discretion of our Board of Directors in accordance with applicable law and will depend on, among other things, our financial condition, results of operations, cash requirements, contractual restrictions and such other factors as our Board of Directors deems relevant.

Accordingly, you may need to sell your shares of our common stock to realize a return on your investment, and you may not be able to sell your shares at or above the price you paid for them. See “Risk Factors—Risks Related to Ownership of our Common Stock—We do not intend to pay dividends for the foreseeable future.”

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CAPITALIZATION

The following table sets forth our cash and cash equivalents, indebtedness and our capitalization as of June 30, 2014 on:

• an actual basis;

• a pro forma basis to give effect to the filing and effectiveness of our Certificate of Incorporation and Bylaws (including the Stock Split), the Preferred Stock Conversion and the Preferred Stock Redemption, each of which will occur immediately prior to or immediately following the completion of this offering; and

• a pro forma as adjusted basis to give effect to the pro forma adjustments set forth above and the sale and issuance by us of             shares of common stock in this offering, based on the initial public offering price of $         per share, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us and after giving effect to the application of the net proceeds received from this offering as described under “Use of Proceeds.”

The pro forma and pro forma as adjusted information below is illustrative only, and our capitalization following the closing of this offering will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing. You should read this information together with our audited and unaudited consolidated financial statements and related notes included elsewhere in this prospectus and the information set forth under the headings “Use of Proceeds,” “Selected Historical Consolidated Financial and Other Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

	As of June 30, 2014
	Actual			Pro Forma	Pro Forma as Adjusted(1)
	(Dollars in thousands) (Unaudited)
Cash and cash equivalents	$	1,924		$	$
Debt:
Stockholder Note		1,140
Revolving Note Payable		82,500
Total debt		83,640
Redeemable Preferred Stock:
Series B, $0.001 par value per share; 250,000 shares authorized, 112,160 issued and outstanding, actual;             shares authorized,             issued and outstanding, pro forma;             shares authorized,             shares issued and outstanding, pro forma as adjusted		33,081
Series C, $0.001 par value per share; 15,000,000 shares authorized, 12,485,906 issued and outstanding, actual;              shares authorized,              issued and outstanding, pro forma;              shares authorized,             shares issued and outstanding, pro forma as adjusted		81,510
Stockholders’ Equity (Deficit):
Common stock, $0.001 par value per share; 54,000,000 shares authorized, 14,035,660 issued and outstanding, actual;              shares authorized,             issued and outstanding, pro forma;              shares authorized,             shares issued and outstanding, pro forma as adjusted		14
Additional paid-in-capital		10,085
Accumulated deficit		(158,928	)
Total stockholders’ equity (deficit)		(148,829	)
Total capitalization	$	49,402		$	$

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(1) A $1.00 increase or decrease in the assumed initial public offering price of $             per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase or decrease the amount of cash and cash equivalents, additional paid-in capital, total stockholders’ equity and total capitalization by approximately $             , assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. Similarly, each increase or decrease of one million shares in the number of shares of common stock offered by us would increase or decrease cash and cash equivalents, and additional paid-in capital, total stockholders’ equity and total capitalization by approximately $             , assuming the assumed initial public offering price remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The pro forma as adjusted information discussed above is illustrative only and will be adjusted based on the actual public offering price and other terms of this offering determined at pricing.

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DILUTION

If you invest in our common stock in this offering, your ownership interest will be immediately diluted to the extent of the difference between the initial public offering price per share and the pro forma as adjusted net tangible book value per share of our common stock after this offering. Our historical net tangible book value (deficit) as of June 30, 2014 was $         million, or $         per share of common stock. Our historical net tangible book value is the amount of our total tangible assets (which for the purpose of this calculation excludes capitalized loan costs) less our total liabilities, divided by the number of shares of common stock outstanding as of June 30, 2014.

Our pro forma net tangible book value as of June 30, 2014 was $         million, or $         per share of common stock. Pro forma net tangible book value represents total tangible assets less total liabilities. Pro forma net tangible book value per share represents pro forma net tangible book value divided by the total number of shares outstanding as of June 30, 2014, after giving effect to the Stock Split and the Preferred Stock Conversion.

Pro forma as adjusted net tangible book value is our pro forma net tangible book value, plus the effect of the sale by us of             shares of our common stock in this offering at the initial public offering price of $         per share, and after deducting underwriting discounts and estimated offering expenses payable by us and after giving effect to the application of the net proceeds received from this offering as described under “Use of Proceeds.” This amount represents an immediate increase in pro forma as adjusted net tangible book value of $         per share to our existing stockholders, and an immediate dilution of $         per share to new investors participating in this offering. We determine dilution per share to new investors by subtracting pro forma as adjusted net tangible book value per share after this offering from the initial public offering price per share paid by new investors.

The following table illustrates this dilution on a per share basis.

Assumed initial public offering price per share	$	$
Pro forma net tangible book value (deficit) per share as of June 30, 2014
Increase per share attributable to new investors
Pro forma as adjusted net tangible book value per share after this offering
Dilution per share to new investors		$

Each $1.00 increase or decrease in the assumed initial public offering price of $         per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase or decrease, as applicable, our pro forma as adjusted net tangible book value per share to new investors by $        , and would increase or decrease, as applicable, dilution per share to new investors in this offering by $        , assuming that the number of shares offered by us and the selling stockholders, as set forth on the cover page of this prospectus, remains the same and after deducting estimated underwriting discounts and commissions payable by us. In addition, to the extent any outstanding options or warrants to purchase common stock are exercised, new investors would experience further dilution.

If the underwriters’ option to purchase additional shares of our common stock is exercised in full, the pro forma as adjusted net tangible book value will increase to $         per share, representing an immediate dilution of $         per share to new investors.

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The following table summarizes, as of June 30, 2014, on a pro forma as adjusted basis as described above, the differences between the number of shares of common stock purchased from us, the total consideration paid to us, and the average price per share paid by existing stockholders and by investors purchasing shares of common stock in this offering. The calculation below is based on the initial public offering price of $         per share, before deducting underwriting discounts and estimated offering expenses payable by us.

	Shares Purchased			Total Consideration			Average Price Per Share
	Number	Percent		Amount	Percent
Existing stockholders			%	$		%	$
New investors
Total			%	$		%	$

Each $1.00 increase or decrease in the assumed initial public offering price of $         per share, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase or decrease, as applicable, the total consideration paid by new investors and total consideration paid by all stockholders by approximately $         million, assuming that the number of shares offered by us and the selling stockholders, as set forth on the cover page of this prospectus, remains the same and after deducting estimated underwriting discounts and commissions payable by us. In addition, to the extent any outstanding options to purchase common stock are exercised, new investors will experience further dilution.

The total number of shares reflected in the discussion and tables above is based on             shares of common stock outstanding as of June 30, 2014 after giving effect to the Stock Split and the Preferred Stock Conversion. The tables above assume no exercise of options to purchase shares of our common stock outstanding as of June 30, 2014.

If the underwriters’ option to purchase additional shares of our common stock is exercised in full, the number of shares held by new investors will increase to             , or     % of the total number of shares of common stock outstanding after this offering.

To the extent that any options or other equity incentive grants are issued in the future with an exercise price or purchase price below the initial public offering price, new investors will experience further dilution.

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SELECTED HISTORICAL CONSOLIDATED FINANCIAL AND OTHER DATA

The following table presents selected consolidated financial data as of, and for the periods ended on, the dates indicated. The consolidated financial data for each of the years ended December 31, 2013 and 2012 have been derived from our audited consolidated financial statements included elsewhere in this prospectus. The consolidated statement of operations data for each of the six months ended June 30, 2014 and 2013 and the consolidated balance sheet data as of June 30, 2014 have been derived from our unaudited consolidated financial statements included elsewhere in this prospectus. The unaudited consolidated financial statements were prepared on the same basis as our audited consolidated financial statements and, in the opinion of management, reflect all adjustments we consider necessary for a fair statement of financial information. You should read the following financial information together with the information under “Capitalization” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements included elsewhere in this prospectus. Historical results are not necessarily indicative of results to be expected for any future period.

	Year ended December 31,						Six months ended June 30,
	2013			2012			2014			2013
	(Dollars in thousands, except per share data)
Consolidated Statement of Operations Data
Net sales	$	63,151		$	43,519		$	39,736		$	28,732
Cost of goods sold		35,958			22,881			20,370			15,234
Gross profit		27,193			20,638			19,366			13,497
Selling, general and administrative expenses		39,574			35,385			24,996			19,851
Loss from operations		(12,381	)		(14,747	)		(5,630	)		(6,353	)
Other expenses		(538	)		(344	)		(85	)		(29	)
Fees on debt guarantee(1)		(5,245	)		(1,895	)		(3,645	)		(2,034	)
Interest expense		(3,492	)		(1,638	)		(2,033	)		(1,540	)
Loss before income taxes		(21,656	)		(18,624	)		(11,393	)		(9,956	)
Income tax expense		(31	)		(32	)		(16	)		(16	)
Net loss		(21,687	)		(18,656	)		(11,409	)		(9,972	)
Preferred stock dividend accretion		(8,596	)		(7,954	)		(6,904	)		(4,143	)
Net loss attributable to common stockholders	$	(30,283	)	$	(26,610	)	$	(18,256	)	$	(14,115	)
Net loss per share:
Basic	$	(2.16	)	$	(1.90	)	$	(1.30	)	$	(1.01	)
Diluted	$	(2.16	)	$	(1.90	)	$	(1.30	)	$	(1.01	)
Weighted average shares of common stock outstanding:
Basic		14,026,999			14,024,908			14,035,660			14,024,908
Diluted		14,026,999			14,024,908			14,035,660			14,024,908

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	Year ended December 31, 2013			Six months ended June 30, 2014
Pro Forma Earnings per Share Data(2)
Net loss per share (unaudited):
Basic	$	(2.16	)	$	(1.30	)
Diluted	$	(2.16	)	$	(1.30	)
Weighted average shares of common stock outstanding used in computing pro forma net income per share (unaudited):
Basic		14,026,999			14,035,660
Diluted		14,026,999			14,035,660

	Year ended December 31,						Six months ended June 30,
	2013			2012			2014			2013
	(Dollars in thousands)
Other Operating and Financial Data
Freshpet Fridge store locations at period end		10,836			8,514			12,593			9,801
EBITDA(3)	$	(6,974	)	$	(10,363	)	$	(2,591	)	$	(4,470	)
Adjusted EBITDA(3)		(192	)		(6,096	)		413			(1,842	)
Capital expenditures:
Freshpet Kitchens and other plant capital expenditures		12,987			13,298			2,548			11,043
Freshpet Fridge and other capital expenditures		11,656			13,097			7,813			6,660
Total cash outflows of capital expenditures		24,643			26,395			10,361			17,703

	As of June 30, 2014
	Actual			Pro Forma(4)	Pro Forma As Adjusted(5)
	(Dollars in thousands)
Consolidated Balance Sheet Data
Cash and cash equivalents	$	1,924		$	$
Working capital(6)		1,179
Property, plant and equipment		55,419
Total assets		74,489
Total debt		83,640
Redeemable preferred stock:
Series B		33,081
Series C		81,510
Total stockholders’ (deficit)	$	(148,829	)	$	$

(1) Represents fees paid to certain stockholders for acting as guarantors for a portion of our payment obligations under the $62.5 Million Revolver. Pursuant to a Fee and Reimbursement Agreement, the Company is obligated to pay each guarantor a contingent fee equal to 10% per annum of the amount each guarantor committed to guarantee. Payments will be made in the form of newly issued shares of Series C Preferred Stock. We plan to use a portion of the proceeds from this offering to repay the borrowings under the $62.5 Million Revolver, relieving us of future fees on debt guarantee. See our consolidated financial statements and the notes thereto included elsewhere in this prospectus for additional information.

(2) For the calculation of basic and diluted net loss per share and pro forma basic and diluted net loss per share, see notes             and             to our unaudited consolidated financial statements included elsewhere in this prospectus.

(3) EBITDA and Adjusted EBITDA are not financial measures prepared in accordance with U.S. generally accepted accounting principles, or GAAP. As used herein, EBITDA represents net loss

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plus depreciation and amortization, interest expense (including fees on debt guarantee, which we believe are a cost of our financing arrangement and are akin to interest expense), and income tax expense. As used herein, Adjusted EBITDA represents EBITDA plus loss on disposal of equipment, new plant startup expense and processing, share based compensation and launch expenses.

We present EBITDA and Adjusted EBITDA because we believe each of these measures provides an additional metric to evaluate our operations and, when considered with both our GAAP results and the reconciliation to net loss set forth below, provides a more complete understanding of our business than could be obtained absent this disclosure. We use EBITDA and Adjusted EBITDA, together with financial measures prepared in accordance with GAAP, such as sales, gross profit percentage, and cash flow from operations, to assess our historical and prospective operating performance, to provide meaningful comparisons of operating performance across periods, to enhance our understanding of our operating performance and to compare our performance to that of our peers and competitors.

Adjusted EBITDA is further utilized for our covenant requirements under our credit agreement, and additionally as an important component of internal budgeting and setting management compensation.

EBITDA and Adjusted EBITDA are presented here because we believe they are useful to investors in assessing the operating performance of our business without the effect of non-cash items, and other items as detailed below.

EBITDA and Adjusted EBITDA should not be considered in isolation or as alternatives to net loss, income from operations or any other measure of financial performance calculated and prescribed in accordance with GAAP. Neither EBITDA nor Adjusted EBITDA should be considered a measure of discretionary cash available to us to invest in the growth of our business. Our Adjusted EBITDA may not be comparable to similarly titled measures in other organizations because other organizations may not calculate Adjusted EBITDA in the same manner as we do. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by the expenses that are excluded from that term or by unusual or non-recurring items. We recognize that both EBITDA and Adjusted EBITDA have limitations as analytical financial measures. For example, neither EBITDA nor Adjusted EBITDA reflects:

• our capital expenditures or future requirements for capital expenditures;

• the interest expense (including fees on debt guarantee, which we believe are a cost of our financing arrangement and are akin to interest expense), or the cash requirements necessary to service interest expense or principal payments, associated with indebtedness;

• depreciation and amortization, which are non-cash charges, although the assets being depreciated and amortized will likely have to be replaced in the future, nor does EBITDA or Adjusted EBITDA reflect any cash requirements for such replacements; and

• changes in or cash requirements for our working capital needs.

Additionally, Adjusted EBITDA excludes (i) non-cash stock based compensation expense, which is and will remain a key element of our overall long term incentive compensation package, and (ii) certain costs essential to our sales growth and strategy, including an allowance for marketing expenses for each new store added to our network and uncapitalizable freight costs associated with Freshpet Fridge replacements. Adjusted EBITDA also excludes certain cash charges resulting from matters we consider not to be indicative of our ongoing operations. Other companies in our industry may calculate EBITDA and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures.

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The following table provides a reconciliation of EBITDA and Adjusted EBITDA to net loss which is the most directly comparable financial measure presented in accordance with GAAP:

	Year ended December 31,						Six months ended June 30,
	2013			2012			2014			2013
	(Dollars in thousands)
Net loss	$	(21,687	)	$	(18,656	)	$	(11,409	)	$	(9,972	)
Fees on debt guarantee(a)		5,245			1,895			3,645			2,034
Depreciation & amortization		5,945			4,728			3,124			1,912
Interest expense		3,492			1,638			2,033			1,540
Income tax expense		31			32			16			16
EBITDA		(6,974	)		(10,363	)		(2,591	)		(4,470	)
Loss on disposal of equipment		503			333			71			24
Launch expense(b)		3,305			2,815			2,334			1,678
New plant start up expenses and processing(c)		1,996						113			436
Share based compensation(d)		978			1,119			486			490
Adjusted EBITDA	$	(192	)	$	(6,096	)	$	413		$	(1,842	)

(a) Represents fees paid to certain stockholders for acting as guarantors for a portion of our payment obligations under the $62.5 Million Revolver. Pursuant to a Fee and Reimbursement Agreement, the Company is obligated to pay each guarantor a contingent fee equal to 10% per annum of the amount each guarantor committed to guarantee. Payments will be made in the form of newly issued shares of Series C Preferred Stock. We plan to use a portion of the proceeds from this offering to repay the borrowings under the $62.5 Million Revolver, relieving us of future fees on debt guarantee except for changes in fair market value. See our consolidated financial statements and the notes thereto included elsewhere in this prospectus for additional information.

(b) Represents new store marketing allowance of $1,000 for each store added to our distribution network as well as the uncapitalized freight costs associated with Freshpet Fridge replacements. The expense enhances the overall marketing spend to support our growing distribution network.

(c) Represents additional operating costs incurred in 2013 and in the first quarter of 2014 in connection with the opening of our new primary manufacturing facility in Bethlehem, Pennsylvania, which was completed in the fourth quarter of 2013.

(d) Represents non-cash stock based compensation expense.

(4) The pro forma balance sheet data gives effect to the Stock Split, the Preferred Stock Conversion and the Preferred Stock Redemption.

(5) The pro forma as adjusted balance sheet data gives effect to the pro forma adjustments set forth above and the sale of shares of common stock by us in this offering at an assumed initial public offering price of $         per share (the midpoint of the estimated price range set forth on the cover of this prospectus), after deducting the underwriting discount and estimated offering expenses payable by us.

(6) Represents our currents assets minus current liabilities.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND

RESULTS OF OPERATIONS

The following discussion summarizes the significant factors affecting our consolidated operating results, financial condition, liquidity and cash flows as of and for the periods presented below. The following discussion and analysis should be read in conjunction with the “Selected Consolidated Historical Financial and Other Data” and our audited and unaudited consolidated financial statements and the related notes thereto, included elsewhere in this prospectus.

In addition to historical information, this discussion and analysis contains forward-looking statements based on current expectations that involve risks, uncertainties and assumptions, such as our plans, objectives, expectations, and intentions set forth under the sections entitled “Risk Factors” and “Forward-Looking Statements.” Our actual results and the timing of events may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in the section entitled “Risk Factors” and elsewhere in this prospectus.

Overview

We started Freshpet with a single-minded mission to bring the power of real, fresh food to our dogs and cats. We were inspired by the rapidly growing view among pet owners that their dogs and cats are a part of their family, leading them to demand healthier pet food choices. Over the last eight years, we have created a comprehensive business model to deliver wholesome pet food that “pet parents” can trust, and in the process we believe we have become one of the fastest growing pet food companies in North America. Our business model is difficult for others to replicate and we see significant opportunity for future growth by leveraging the unique elements of our business, including our brand, our product know-how, our Freshpet Kitchens, our refrigerated distribution, our Freshpet Fridge and our culture.

Components of our Operating Results

Net Sales

Our net sales are derived from the sale of pet food to our customers, who purchase either directly from us or through third party distributors. Our products are sold to consumers through a fast-growing network of company-owned branded refrigerators, known as Freshpet Fridges, located in our customers’ stores. We continue to roll out Freshpet Fridges across leading retailers across North America and have installed Freshpet Fridges in over 12,500 retail stores as of June 30, 2014. All of our products are sold under the Freshpet brand name, with ingredients, packaging and labeling customized by class of retail. Sales are recorded net of discounts, slotting, returns and promotional allowances.

Our net sales growth is driven by the following key factors:

• Increased penetration of Freshpet Fridge locations in major classes of retail, including grocery, mass, club, pet specialty and natural. The impact of new Freshpet Fridge installations on our net sales varies by retail class and depends on numerous factors including store traffic, refrigerator size, placement within the store, and proximity to other stores that carry our products.

• Increasing sales velocity from the average Freshpet Fridge due to increasing awareness, trial and adoption of Freshpet products. Our investments in marketing and advertising help to drive awareness and trial at each point of sale.

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• Continued innovation and new product introductions. New products introduced since 2011 represented 31% of our net sales in 2013. From time to time, we review our product line and may remove products that are not meeting sales or profitability goals.

• Consumer trends including growing pet ownership, pet humanization and a focus on health and wellness.

We believe that as a result of the above key factors, we will continue to penetrate the pet food marketplace and increase our share of the pet food category.

Gross Profit

Our gross profit is net of costs of goods sold, which include the costs of product manufacturing, product ingredients, packaging materials and inbound freight. The construction of our scalable manufacturing facility in Bethlehem, Pennsylvania was completed in November 2013, essentially replacing our Quakertown, Pennsylvania facility, and has significantly improved our production efficiency. Growing capacity utilization of our new facility will allow us to leverage fixed costs and thereby expand our gross margins.

Our gross margin is impacted by the cost of ingredients and packaging materials. We expect to mitigate any adverse movement in input costs through a combination of cost management and price increases. A 10% increase in our overall cost of ingredients without an offsetting increase in our pricing would affect our gross margin by approximately 2.5%. We implemented modest price increases in 2011 and 2012 that offset increased ingredient costs and did not perceive a decline in demand.

Selling, General and Administrative Expenses

Our selling, general and administrative expenses consist of the following:

Outbound freight.    Outbound freight from our Freshpet Kitchens is managed by a national third-party refrigerated and frozen human food manufacturer that delivers our product to grocery retailers in the United States. Additionally, we sell through third-party distributors for the mass, club, pet specialty and natural classes in the United States and Canada. As our sales volume increases, we expect our outbound freight costs to decrease as a percentage of net sales as we achieve benefits of scale.

Marketing & advertising.    Our marketing and advertising expenses primarily consist of national television media, digital marketing, social media, and grass roots marketing to drive brand awareness. These expenses may vary from quarter to quarter depending on the timing of our marketing and advertising campaigns. We expect our marketing & advertising costs to decrease as a percentage of net sales as we leverage national advertising spend across a growing network of Freshpet Fridges.

Freshpet Fridge operating costs.    Freshpet Fridge operating costs consist of repair costs, installation fees to third-party service providers, and depreciation. The purchase and installation costs for new Freshpet Fridges are capitalized and depreciated over the estimated useful life. All new refrigerators are covered by a manufacturer warranty for one to three years. We subsequently incur maintenance and freight costs for repairs and refurbishments handled by third-party service providers.

Research & development.    Research and development costs consist of expenses to develop and test new products.

Brokerage.    We utilize third-party brokers to assist with monitoring our Freshpet Fridges at the point-of-sale as well as representing us at headquarters for various customers. These brokers visit our retail customers’ store locations and ensure items are stocked, maintain Freshpet Fridge appearance, and replace missing price tags.

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Other general & administrative costs.    Other general and administrative costs include non-plant personnel salaries and benefits, as well as corporate general & administrative costs. After this offering, we expect to incur incremental annual costs of approximately $1.5 million to $2.0 million per year related to operating as a public company.

Selling, general and administrative costs as a percentage of net sales have decreased from 81.3% in 2012 to 62.7% in 2013, and from 69.1% in the six months ended June 30, 2013 to 62.9% in the six months ended June 30, 2013. We expect our selling, general, and administrative expenses to decrease as a percentage of net sales as we continue to expand our distribution footprint and grow our net sales.

Fees on Debt Guarantee

In connection with the $62.5 Million Revolver, we entered into a Fee and Reimbursement Agreement with certain stockholders who are also guarantors of the note. That agreement stipulates that we will pay each guarantor a contingent fee of 10% per annum of the amount each guarantor has committed to guarantee. The fees on debt guarantee recognized each period is a function of the outstanding note payable and the fair value of the underlying guarantee. The fees on debt guarantee liability will ultimately be settled in the form of shares of our Series C Preferred Stock at a price of $5.25 per share. We plan to use a portion of the proceeds from this offering to repay the borrowings under the $62.5 Million Revolver, relieving us of future fees on the debt guarantee except for changes in fair market value.

Income Taxes

We had federal net operating loss (“NOL”) carry forwards of approximately $132 million at December 31, 2013, which expire between 2025 and 2033. We may be subject to certain limitations in our annual utilization of net operating loss carry forwards to off-set future taxable income pursuant to Section 382 of the Internal Revenue Code, which could result in NOLs expiring unused. At December 31, 2013, we had approximately $124 million of State of New Jersey NOLs, which expire between 2014 and 2033. At December 31, 2013, we had a full valuation allowance against our deferred tax assets as the realization of such assets was not considered more likely than not.

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Results of Operations

	Twelve months ended December 31,												Six months ended June 30,
	2013						2012						2014						2013
	Amount			Percent of Net Sales			Amount			Percent of Net Sales			Amount			Percent of Net Sales			Amount			Percent of Net Sales
	(Dollars in thousands)
Consolidated Statements of Operations Data
Net sales	$	63,151			100	%	$	43,519			100	%	$	39,736			100	%	$	28,732			100	%
Cost of goods sold		35,958			57			22,881			53			20,370			51			15,234			53
Gross profit		27,193			43			20,638			47			19,366			49			13,497			47
Selling, general and administrative expenses		39,574			63			35,385			81			24,996			63			19,851			69
Loss from operations		(12,381	)		(20	)		(14,747	)		(34	)		(5,630	)		(14	)		(6,353	)		(22	)
Other expenses:
Other expenses		(538	)		(1	)		(344	)		(1	)		(85	)		(0	)		(29	)		(0	)
Fees on debt guarantee		(5,245	)		(8	)		(1,895	)		(4	)		(3,645	)		(9	)		(2,034	)		(7	)
Interest expense		(3,492	)		(6	)		(1,638	)		(4	)		(2,033	)		(5	)		(1,540	)		(5	)
Loss before income taxes		(21,656	)		(34	)		(18,624	)		(43	)		(11,393	)		(29	)		(9,956	)		(35	)
Income tax expense		(31	)		(0	)		(32	)		(0	)		(16	)		(0	)		(16	)		(0	)
Net loss	$	(21,687	)		(34	)%	$	(18,656	)		(43	)%	$	(11,409	)		(29	)%	$	(9,972	)		(35	)%

Six Months Ended June 30, 2014 Compared to Six Months Ended June 30, 2013

Net Sales

The following table sets forth net sales by class of retail:

	Six Month ended June 30,
	2014					2013
	Amount		Percentage of Net Sales			Amount		Percentage of Net Sales
Grocery and Mass (1)	$	29,851,193		75	%	$	22,474,475		78	%
Pet Specialty, Natural, and Other (2)		9,885,042		25	%		6,257,076		22	%
Net Sales	$	39,736,235		100	%	$	28,731,551		100	%

(1) Includes club retail class

(2) Other sales represent less than 1% of net sales

Net sales increased $11.0 million, or 38%, to $39.7 million for the six months ended June 30, 2014, as compared to the same period in the prior year. This increase was primarily driven by the growth in Freshpet Fridges store locations, which grew by 28% from 9,801 as of June 30, 2013 to 12,593 as of June 30, 2014. We also experienced velocity gains in Grocery and Mass as well as Pet specialty, Natural and Other channels, along with a 3% increase due to product mix.

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Gross Profit

Gross profit increased $5.9 million, or 43%, to $19.4 million for the six months ended June 30, 2014 as compared to the same period in the prior year. This increase was primarily driven by higher net sales and lower manufacturing costs per pound due to the completion of our new Freshpet Kitchens in Bethlehem, Pennsylvania in the fourth quarter of 2013. The increase was partially offset by higher depreciation of approximately $1.0 million related to the new manufacturing facility. As a result, gross profit as a percentage of net sales increased to 49% for the six months ended June 30, 2014 compared to 47% in the same period of the prior year. We expect our gross profit as a percentage of net sales to continue to increase as we realize efficiencies of scale with growing net sales.

Selling, General & Administrative Expenses

Selling, general and administrative expenses increased $5.1 million, or 26%, to $25.0 million for the six months ended June 30, 2014 as compared to the same period in the prior year. Key components of the dollar increase include $1.0 million of incremental outbound freight costs on increased volume sold, $2.6 million of additional marketing expenses to drive brand awareness, and $1.5 million of additional operating expenses attributable to new hires, retail brokerage, and Freshpet Fridge depreciation and maintenance. As a percentage of net sales, selling, general and administrative expenses decreased from 69% for the period ended June 30, 2013 to 63% for the period ended June 30, 2014.

Loss from Operations

Loss from operations decreased $0.7 million, or 11%, to $5.6 million for the six months ended June 30, 2014 as compared to the same period in the prior year as a result of the factors mentioned above. Loss from operations was 14% of net sales for the six months ended June 30, 2014, as compared to loss from operations of 22% of net sales for the same period in the prior year.

Fees on Debt Guarantee

Fees on debt guarantee increased $1.6 million, or 79%, to $3.6 million for the six months ended June 30, 2014 as compared to the same period in the prior year due to the increase in the amount of guaranteed debt outstanding of $62.5 million from $50.0 million in June 2013, coupled with the change in the fair value of the fees on debt guarantee.

Interest Expense

Interest expense increased $0.5 million, or 32%, to $2.0 million for the six months ended June 30, 2014 as compared to the same period in the prior year due to an increase in borrowings used to support increased working capital and capital needs to manage growth.

Net Loss

Net loss increased $1.4 million, or 14%, to $11.4 million for the six months ended June 30, 2014 as compared to the same period in the prior year. Net loss was 29% of net sales for the six months ended June 30, 2014 as compared to a net loss of 35% of net sales for the same period in the prior year.

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Twelve Months Ended December 31, 2013 Compared to the Twelve Months Ended December 31, 2012

Net Sales

The following table sets forth net sales by class of retail:

	Twelve months ended December 31,
	2013					2012
	Amount		Percentage of Net Sales			Amount		Percentage of Net Sales
Grocery and Mass (1)	$	49,731,873		79	%	$	33,985,199		78	%
Pet Specialty, Natural, and Other (2)		13,418,903		21	%		9,534,262		22	%
Net Sales	$	63,150,776		100	%	$	43,519,461		100	%

(1) Includes club retail class

(2) Other sales represent less than 1% of net sales

Net sales increased $19.7 million, or 45%, to $63.2 million for 2013 as compared to the prior year. The number of stores carrying Freshpet products grew from 8,514 stores as of December 31, 2012 to 10,836 as of December 31, 2013, an increase of 27%. We also experienced velocity gains in Grocery and Mass as well as Pet specialty, Natural and Other during 2013, along with a 5% increase in the average selling price during 2013 due to changes in product mix.

Gross Profit

Gross profit increased by $6.5 million, or 32%, to $27.2 million for 2013 as compared to the prior year. The increase was primarily driven by higher net sales, partially offset by higher cost per pound of manufacturing due to duplicate expenditures of $0.9 million, related to duplicate plant personnel and plant overhead during the transition to our new Freshpet Kitchens facility in Bethlehem, Pennsylvania in the last quarter of 2013, as well as incremental outsourced processing costs of $1.1 million to guarantee quality during the transition to the new Freshpet Kitchens. Additionally, during 2013, we incurred a net loss for disposal of non-usable equipment in the amount of $0.8 million, which was charged to costs of goods sold. We expect our gross profit as a percentage of net sales to expand as we realize operating leverage with increasing economies of scale of our Freshpet Kitchens.

Selling, General and Administrative Expenses

Selling, general and administrative expenses increased $4.2 million, or 12%, to $39.6 million for 2013 as compared to the prior year. As a percentage of net sales, selling, general and administrative expenses decreased from 81% for 2012 to 63% for 2013. Key components of the increase in expenses include additional outbound freight costs of $1.7 million due to increased volume sold, higher marketing expenses of $1.4 million and incremental operating expenses of $1.1 million. The increased operating expenses were primarily due to new hires, increased employee benefit costs, higher brokerage with growing sales, and increased refrigerator repairs due to our growing Freshpet Fridge network.

Loss from Operations

Loss from operations decreased $2.4 million, or 16%, to $12.4 million for 2013 as compared to the prior year as a result of the factors discussed above.

Fees on Debt Guarantee

Fees on debt guarantee expense increased $3.3 million, or 177%, to $5.2 million in 2013 as compared to the prior year due to the increase in the amount of guaranteed debt from $40.0 million to $60.0 million in May 2013, a full year of guarantee fees in 2013, plus the change in the fair value of the fees on debt guarantee.

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Interest Expense

Interest Expense increased $1.9 million, or 113%, to $3.5 million for 2013 as compared to the prior year due to due to increased borrowings for both working capital and capital expenditures for new refrigerators to support retail expansion and plant improvements.

Net Loss

Net loss increased $3.0 million, or 16%, to $21.7 million for 2013 as compared to the prior year.

	2014
	Q1			Q2
	(Dollars in thousands)
Freshpet Fridge store locations		11,596			12,593
Net sales	$	19,350		$	20,386
Gross profit		9,293			10,073
Gross margin		48.0	%		49.4	%
Net loss	$	(5,142	)	$	(6,267	)

	2013
	Q1			Q2			Q3			Q4
	(Dollars in thousands)
Freshpet Fridge store locations		9,001			9,801			10,269			10,836
Net sales	$	13,885		$	14,848		$	16,698		$	17,720
Gross profit		6,598			6,900			7,277			6,418
Gross margin		47.5	%		46.5	%		43.6	%		36.2	%
Net loss	$	(4,719	)	$	(5,254	)	$	(6,495	)	$	(5,219	)

	2012
	Q1			Q2			Q3			Q4
	(Dollars in thousands)
Freshpet Fridge store locations		7,190			7,891			8,155			8,514
Net sales	$	9,383		$	10,537		$	11,227		$	12,372
Gross profit		4,300			5,005			5,323			6,010
Gross margin		45.8	%		47.5	%		47.4	%		48.6	%
Net loss	$	(4,388	)	$	(4,179	)	$	(6,018	)	$	(4,071	)

Liquidity and Capital Resources

Developing our business will require significant capital in the future. To meet our capital needs, we expect to rely on our cash flow from operations, the proceeds from this offering and other third-party financing. Third-party financing in the future may not, however, be available on terms favorable to us, or at all. Our ability to obtain additional funding will be subject to various factors, including general market conditions, our operating performance, the market’s perception of our growth potential, lender sentiment and our ability to incur additional debt in compliance with other contractual restrictions, such as financial covenants under our debt documents.

Additionally, our ability to make payments on, and to refinance, our indebtedness and to fund planned expenditures for our growth plans will depend on our ability to generate cash in the future. If our business does not achieve the levels of profitability or generate the amount of cash that we anticipate or if we expand faster than anticipated, we may need to seek additional debt or equity financing to operate and expand our business.

We believe that cash and cash equivalents, expected cash flow from operations and planned borrowing capacity are adequate to fund debt service requirements, operating lease obligations, capital

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expenditures and working capital obligations for the next            quarters. However, our ability to continue to meet these requirements and obligations will depend on, among other things, our ability to achieve anticipated levels of revenue and cash flow from operations and our ability to manage costs and working capital successfully. Additionally, our cash flow generation ability is subject to general economic, financial, competitive, legislative and regulatory factors and other factors that are beyond our control. We cannot assure you that our business will generate cash flow from operations in an amount sufficient to enable us to fund our liquidity needs. Further, our capital requirements may vary materially from those currently planned if, for example, our revenues do not reach expected levels or we have to incur unforeseen capital expenditures and make investments to maintain our competitive position. If this is the case, we may seek alternative financing, such as selling additional debt or equity securities, and we cannot assure you that we will be able to do so on favorable terms, if at all. Moreover, if we issue new debt securities, the debt holders would have rights senior to common stockholders to make claims on our assets, and the terms of any debt could restrict our operations, including our ability to pay dividends on our common stock. If we issue additional equity or convertible debt securities, existing stockholders may experience dilution, and such new securities could have rights senior to those of our common stock. These factors may make the timing, amount, terms and conditions of additional financings unattractive. Our inability to raise capital could impede our growth or otherwise require us to forego growth opportunities and could materially adversely affect our business, financial condition and results of operations.

	December 31,					June 30,
	2013		2012			2014		2013
	(Dollars in thousands)
Cash & Equivalents	$	2,445	$	1,633		$	1,924	$	1,018
Accounts Receivable, net		3,498		2,778			5,372		3,374
Inventory		5,512		3,824			5,753		4,478
Prepaid Expense and Other		174		144			1,289		133
Accounts Payable		6,287		9,206			9,966		7,472
Accrued Expenses		1,907		2,284			3,193		4,887
Working Capital	$	3,435	$	(3,111	)	$	1,179	$	(3,355	)

Working Capital consists of current assets net of current liabilities.

The increase in working capital for 2013 compared to 2012 is primarily due to increased cash as a result of equity funding received in November 2013, increased accounts receivable due to higher net sales, increased inventory due to a higher net sales run-rate and a decrease in accounts payable. Additionally, we had lower accrued expenses due primarily to reduced incentive compensation.

The increase in working capital for June 30, 2014 compared to June 30, 2013 is primarily due to increased cash as a result of less cash used in operating activities, increased accounts receivable due to higher net sales, increased inventory due to a higher net sales run-rate. Additionally, we had lower net current liabilities due to timing of payments.

Our primary cash needs are for ingredients, purchases and operating expenses, marketing expenses and capital expenditures to procure Freshpet Fridges and expand and improve our manufacturing plant to support our net sales growth.

We normally carry 3 to 4 weeks of finished goods inventory. The average duration of our accounts receivable is approximately 3 weeks.

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To date, our funding has consisted primarily of debt borrowings and private placements of capital stock. At December 31, 2013, our bank debt was $75.0 million. In the first six months of 2014, we raised $6.6 million through the sale of preferred stock while also securing an additional $7.5 million of bank debt.

The following table sets forth, for the periods indicated, our beginning balance of cash, net cash flows provided by (used in) operating, investing and financing activities and our ending balance of cash.

	December 31,						June 30,
	2013			2012			2014			2013
	(Dollars in thousands)
Cash at the beginning of period	$	1,633		$	2,892		$	2,445		$	1,633
Net cash provided by (used in) operating activities		(11,241	)		(8,716	)		(4,445	)		(4,912	)
Net cash provided by (used in) investing activities		(24,643	)		(26,306	)		(10,127	)		(17,703	)
Net cash flow from financing activities		36,696			33,763			14,051			22,000
Cash at end of period	$	2,445		$	1,633		$	1,924		$	1,018

Net Cash used in Operating Activities.

Cash used in operating activities consists primarily of net income adjusted for certain non-cash items (provision for loss on receivables, loss on disposal of equipment, fees on debt guarantee, depreciation and amortization, share based compensation, and issuance of common stock options for service).

For the six months ended June 30, 2014, net cash used in operating activities was $4.5 million, which consisted of a net loss of $11.4 million, partially offset by $7.5 million of non-cash items and $0.6 million decrease related to changes in operating assets and liabilities. The change in operating assets and liabilities primarily consisted of an increase in accounts receivable of $2.1 million and an increase of prepaid expenses and other current assets of $1.1 million, partially offset by a decrease of $2.8 million of accounts payable and accrued expenses. The increase in accounts receivable is primarily due to growth in net sales.

For the six months ended June 30, 2013, net cash used for operating activities was $5.0 million and consisted of a net loss of $10.0 million, partially offset by $4.5 million of non-cash items and an increase of $0.5 million related to changes in operating assets and liabilities. The changes in operating assets and liabilities was due to the increase of net payables and accrued expense of $1.9 million being greater than the increase of inventories and accounts receivable by $0.6 million. The increase in accounts receivable and increase in inventory is primarily due to growth of net sales.

For 2013, net cash used in operating activities was $11.2 million and consisted of net loss of $21.7 million, partially offset by $13.3 million net non-cash items and $2.8 million of increases due to changes in operating assets and liabilities. The changes in operating assets and liabilities consisted primarily of increases in accounts receivable of $0.9 million, an increase in inventories of $1.8 million, an increase in prepaid and other assets of $0.2 million, partially offset by an increase in payables and accrued expenses of $0.1 million. The increases in accounts receivable and inventory are primarily due to 45% growth of net sales compared to 2012.

For 2012, net cash used in operating activities was $8.7 million and consisted of net loss of $18.7 million, partially offset by net non-cash expenses of $8.2 million and a $1.8 million increase related to changes in operating assets and liabilities. Changes in operating assets and liabilities consisted

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primarily of increases in accounts receivable of $1.6 million, an increase in inventories of $0.8 million, an increase in prepaid and other assets of $0.1 million, partially offset by an increase in payables and accrued expenses of $4.2 million. The increases in accounts receivable and inventory are primarily due to 71% growth of net sales compared to 2011. The increase in payables was due to timing of payments for capital and other operating expenses. The increase in accrued expenses was primarily due to increased incentive compensation.

Net Cash Used in Investing Activities

Net cash used in investing activities for the six months ended June 30, 2014 and for the six months ended June 30, 2013 relates primarily to capital expenditures. Net cash used in investing activities was $10.0 million and $17.6 million for the respective periods. The capital spending during 2013 was primarily related to the purchase of various plant equipment for the new Freshpet Kitchens in Bethlehem, Pennsylvania, which was $11.0 million. Included in both periods is the capitalized acquisition cost of Freshpet Fridges and other equipment, which was $7.6 million in 2014 and $6.6 million in 2013.

Net cash used in investing activities for 2013 and 2012 relates primarily to capital expenditures. Net cash used in investing activities was $24.6 million and $26.3 million for 2013 and 2012, respectively. The capital spending was primarily related to the purchase of various plant equipment for the new Freshpet Kitchens in Bethlehem, Pennsylvania, which was $13.0 million and $13.3 million for 2013 and 2012, respectively. Included in both periods is the capitalized acquisition cost of Freshpet Fridges and other equipment, which was $11.7 million in 2013 and $13.1 million in 2012.

Net Cash from Financing Activities

Net cash from financing activities was $14.1 million for the six months ended June 30, 2014 and $22.0 million for the six months ended June 30, 2013. The net cash from financing activities for the six months ended June 30, 2014 related to $6.6 million of proceeds from the issuance of our preferred stock and $7.5 million related to increased borrowing of notes payable. The net cash from financing activities for the six months ended June 30, 2013 was attributable to increases in notes payable.

Net cash from financing activities was $36.7 million for 2013 and $33.8 million for 2012. The funds received were primarily due to an increase in bank debt borrowings of $32.0 million during 2013 and $33.0 million during 2012, as well as proceeds from the issuance of our preferred stock of $5.0 million during 2013 and $1.1 million during 2012.

Indebtedness

We have a $20.0 million revolving note payable (the “$20 Million Revolver”) with a maturity date of October 31, 2015 with City National Bank. The $20 Million Revolver bears interest at either a LIBOR Rate plus 8% margin or a Base Rate plus 6%, depending on our election. The loan is collateralized by substantially all of our assets. The loan agreement provides for the maintenance of various financial covenants. We are currently in compliance with these requirements. Borrowings under the $20 Million Revolver totaled $15.0 million at December 31, 2013 and 2012. The recorded carrying values of our debt balances approximate fair value given our debt is at variable rates tied to market indicators or is short-term in nature.

We entered into a $62.5 million revolving note payable (the “$62.5 Million Revolver”) with a maturity date of May 1, 2016 with OneWest Bank. Subject to certain conditions, the maturity date may be extended until May 1, 2017 upon delivery of legal opinions stating that a major stockholder has the right to call capital up through May 1, 2017. The $62.5 Million Revolver bears interest at either a LIBOR

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Rate (LIBOR Adjusted Rate plus 3.25%) or a Base Rate (Base Rate plus 2.25%). Monthly, LIBOR Rate loans are payable at the end of the selected interest rate. The $62.5 Million Revolver is subordinated to the $20 Million Revolver except with respect to a first mortgage on the Bethlehem, Pennsylvania property. The $62.5 Million Revolver agreement provides for the maintenance of certain financial covenants. We are currently in compliance with these requirements. Borrowings on the $62.5 Million Revolver totaled $60 million at December 31, 2013 and $28 million at December 31, 2012. We refer to the $20 Million Revolver and the $62.5 Million Revolver as our “Revolving Note Payable.”

In connection with the $62.5 Million Revolver, we entered into a Fee and Reimbursement Agreement with certain stockholders who are also guarantors of the note.

Our indebtedness includes $1.5 million of notes issued to certain stockholders (the “Stockholder Note”). The Stockholder Note accrues interest compounded annually at a rate of 10%. The Stockholder Note and all accrued interest are due on December 23, 2020.

For every $16.39 that was borrowed in connection with the Stockholder Note, one share of common stock was issued to the lender. The unamortized discount associated with the debt equaled $387,688 and $443,072 at December 31, 2013 and 2012, respectively. The amortization expense of $55,384 is recorded within interest expense in the statement of operations and comprehensive loss. The accrued interest totaled $667,109 and $470,145 at December 31, 2013 and 2012, respectively.

Contractual Obligations and Commitments

The following table sets forth our expected contractual obligations as of December 31, 2013:

	Payments Due by Period
(Dollars in thousands)	Total		Less than 1 Year		Between 1-3 Years		Between 3-5 Years		More than 5 Years
Long-term debt obligations(1)	$	79,213,642	$	—	$	75,000,000	$	—	$	4,213,642
Operating lease obligations		235,957		222,853		13,104		—		—
Total	$	79,449,599	$	222,853	$	75,013,104	$	—	$	4,213,642

(1) The $79,213,642 includes total debt outstanding as of December 31, 2013 comprised of $1,112,312, $15,000,000 and $60,000,000 relating to the Stockholder Note, the $20 Million Revolver and the $62.5 Million Revolver, respectively. The remaining $3,101,330 is comprised of the unamortized discount on the Stockholder Note, the accrued interest on the Stockholder Note as of December 31, 2013, and future accrued interest on the Stockholder Note. The Stockholder Note matures on December 23, 2020.

Employment Agreements—We are committed under the terms of employment agreements to pay three officers through the first anniversary of the date of a change in control event, at which time the commitments will automatically renew for additional one year periods, until termination by either party.

Segment

We have determined we operate in one segment: the manufacturing, marketing, and distribution of pet food and pet treats for dogs and cats.

Off Balance Sheet Arrangements

We have no off balance sheet arrangements or any holdings in variable interest entities.

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Critical Accounting Policies

Our management’s discussion and analysis of financial condition and results of operations is based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the revenue and expenses incurred during the reported periods. On an ongoing basis, we evaluate our estimates and judgments, including those related to accrued expenses and stock-based compensation. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not apparent from other sources. Changes in estimates are reflected in reported results for the period in which they become known. Actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies are described in the notes to our financial statements appearing in this prospectus, we believe that the following critical accounting policies are most important to understanding and evaluating our reported financial results.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of net sales and expenses during the reporting period.

We believe that the accounting policies discussed below are critical to understanding our historical and future performance, as these policies related to the more significant areas involving management’s judgments and estimates. We base our estimates on historical experience and on various assumptions that we believe to be reasonable under the circumstances. Actual results, as determined at a later date, could differ from those estimates. To the extent that there are differences between our estimate and the actual results, our future financial statement presentation, financial condition, results of operations and cash flows will be affected.

The following critical accounting policies reflect significant judgments and estimates used in preparation of our consolidated financial statements:

Property, Plant and Equipment—Property, plant and equipment are recorded at cost. We provide for depreciation on the straight-line method by charges to income at rates based upon estimated recovery periods of 7 years for furniture and office equipment, 5 years for automotive equipment, 3 – 9 years for refrigeration equipment, 5 – 10 years for machinery and equipment, and 15 – 39 years for building and improvements. Capitalized cost includes the costs incurred to bring the property, plant and equipment to the condition and location necessary for its intended use, which includes any necessary delivery, electrical and installation cost for equipment. Maintenance and repairs that do not extend the useful life of the assets over two years are charged to expense as incurred. Leasehold improvements are amortized over the shorter of the term of the related lease or the estimated useful lives on the straight-line method (without consideration of option renewal terms).

We evaluate all long-lived assets for impairment. Long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. Management must exercise judgment in assessing whether or not circumstances require a formal evaluation of the recoverability of our long-lived assets. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset

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exceeds its estimated undiscounted future net cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Recoverability of assets held for sale is measured by a comparison of the carrying amount of an asset or asset group to their fair value less estimated costs to sell. Estimating future cash flows and calculating fair value of assets requires significant estimates and assumptions by management. These estimates involve inherent uncertainties, and the measurement of the recoverability of the cost of a potentially impaired asset is dependent on the accuracy of the assumptions used in making the estimates and how these estimates compare to our future operating performance. If the carrying amount is not fully recoverable, an impairment loss is recognized to reduce the carry amount to fair value, and is charged to expense in the period of impairment.

Income Taxes—We account for income taxes under the asset and liability method in accordance with authoritative guidance for income taxes. We recognize deferred tax assets and liabilities and their respective tax basis and operating loss and tax credit carry forwards. We measure deferred tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recorded or settled. We recognize the effect on deferred tax assets and liabilities of a change in tax rates in income in the period that includes the enactment date.

At December 31, 2013, we had federal NOL carryforwards of approximately $132.0 million, which expire at various dates between 2025 and 2033. We may be subject to the net operating loss utilization provisions of Section 382 of the Code. The effect of an ownership change would be the imposition of an annual limitation on the use of NOL carryforwards attributable to periods before the change. The amount of the annual limitation depends upon our value immediately before the ownership change, changes to our capital during a specified period prior to the change, and the federal published interest rate. Although we have not undergone a Code Section 382 analysis, if we were to undergo an ownership change it is likely that the utilization of the NOLs will be substantially limited.

A valuation allowance is appropriate when management believes it is more likely than not, the deferred tax asset will not be realized. At December 31, 2013 and 2012, we determined that a valuation allowance of approximately 100% is deemed appropriate.

Revenue Recognition and Incentives—Revenue from product sales is recognized upon shipment to the customers, at which point title and risk of loss is transferred and the selling price is fixed or determinable. This completes the revenue-earning process specifically that an arrangement exists, delivery has occurred, ownership has transferred, the price is fixed and collectability is reasonably assured. A provision for payment discounts and product return allowances, which is estimated based upon our historical performance, management’s experience and current economic trends, is recorded as a reduction of sales in the same period that the revenue is recognized.

Trade incentives, consisting primarily of customer pricing allowances and merchandising funds and consumer coupons are offered through various programs to customers and consumers. Sales are recorded net of estimated trade incentive spending, which is recognized as incurred at the time of sale. Accruals for expected payouts under these programs are included as accrued expense in the consolidated balance sheet. Coupon redemption costs are also recognized as reductions of net sales when the coupons are issued. Estimates of trade promotion expense and coupon redemption costs are based upon programs offered, timing of those offers, estimated redemption/usage rates from historical performance, management’s experience and current economic trends.

Valuation of our Preferred Shares—As of June 30, 2014, we had 112,160 shares of Series B Preferred Stock and 12,485,906 shares of Series C Preferred Stock issued and outstanding, respectively.

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Valuation of Series B Preferred Stock

All shares of Series B Preferred Stock were issued in 2006 and 2007. In determining the issue price, we considered the voting, dividend, and liquidation rights of the Series B Preferred Stock. Based on the terms, it was concluded that the fair value of the Series B Preferred Stock was $100 a share. The Series B Preferred Stock is not convertible to common stock.

Valuation of Series C Preferred Stock

The initial tranche of Series C Preferred Stock totaling 9.1 million shares were issued in December 2010 at $5.25 per share to an investor which had no previous investment in the Company. In determining the valuation of the Series C Preferred Stock we considered a separate transaction that occurred during December 2010, in which we repurchased approximately 4.8 million shares of our common stock from an investor at $5.25 a share, which represented approximately 25% of the outstanding common shares immediately before the transaction. Based on the arm’s length transaction and taking into account the various rights and preferences of the equity securities transacted, our Board of Directors deemed the fair value of the Series C Preferred Stock to be $5.25. In reaching this determination, we considered many factors, including (i) the Series C Preferred Stock is convertible into common stock at a rate of 1:1, (ii) the Series C Preferred Stock dividends are only payable in a liquidation or redemption event and are not considered in the conversion into common stock and (iii) the Series C Preferred Stock voting rights are equivalent to the voting rights of the common stock. Accordingly, our Board of Directors believed that the repurchase of our common stock from a third party investor represented a reasonable measure of fair value of our Series C Preferred Stock given the similarities in the terms of the securities.

During the following 13-months, we issued an additional 1.1 million shares of Series C Preferred Stock at $5.25 per share. During that period we did not issue any shares of our common stock. Due to no additional arm’s length transactions during the period, our Board of Directors considered various objective and subjective factors to determine the fair market value of our Series C Preferred Stock, including:

• the per share price of the December 2010 sale of Series C Preferred Stock and repurchase of common stock;

• revenue and corresponding expense growth;

• external market conditions affecting the pet food industry;

• trends within the pet food industry;

• our results of operations and financial position; and

• our stage of business strategy.

Based on the factors above, the Board of Directors determined that the Series C Preferred Stock fair value was unchanged at $5.25.

During November 2013 and February 2014, we issued additional shares of Series C Preferred Stock totaling 1.4 million at a per share price of $5.25. Given the passage of time since our last third party transaction involving our common stock, we engaged a third-party valuation specialist to assist us in determining the value our common stock as of February 6, 2014. The common stock valuation was determined using a weighted average enterprise value employing an income and market approach analysis. The income approach uses valuation techniques to convert future cash flows and earnings to a single present value amount. The market approach used the guideline company method, a valuation technique in which the fair market value is calculated based on market prices realized in actual arm’s

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length transactions. The technique consists of undertaking a detailed market analysis of publicly traded companies that provides a reasonable basis for comparison to the relative investment characteristics of the subject company. Valuation ratios, which relate market prices to selected financial statistics derived from the guideline companies, are selected and applied to the subject company after consideration of adjustments for financial position, growth, markets, profitability, and other factors. The enterprise value was weighted using 80% income approach and 20% market approach. The Option Pricing Method (OPM) was then used to allocate enterprise value to each class of equity, taking into account the relative rights and preferences of each class. A discount for lack of marketability of approximately 11% was applied to reach the final valuation of the common stock; because, as we are a private company, there are impediments to liquidity, including lack of publicly available information and the lack of a trading market. The valuation specialist determined the fair value of our common stock at February 6, 2014 was $0.88 per share. The reduction in the fair value of the common stock we experienced from December 31, 2010 to December 31, 2013 was attributable to (i) the dividends recognized on the Preferred Series B and C; (ii) the debt guarantee fees that began in June 2012 and (iii) significant capital expenditures for both Freshpet Fridges and new manufacturing facility in Bethlehem, Pennsylvania.

In addition, during April 2014 we issued additional shares of Series C Preferred Stock totaling 0.8 million at a per share price of $5.25. In assessing whether the April 2014 issuance had a beneficial conversion feature, we noted the new information on hand since the last valuation two months prior on February 6, 2014. Since the last Series C Preferred Stock Valuation, further progress was made towards an initial public offering, or IPO, including interviewing investment banks to underwrite a proposed IPO. We further noted that the first quarter results for 2014 and updated forecast were in line with the forecast that was utilized in the February 6, 2014 valuation report. Based on the updated information on hand, it was noted that there was not enough new information that would increase the valuation of the common stock above the $5.25 grant price of the April 2014 Series C Preferred Stock issuance.

There is no beneficial conversion feature associated with any of the issuance of the Preferred Series C Preferred Stock

Share Based Compensation—We account for all share-based compensation payments issued to employees, directors, and non-employees using a fair value method. Accordingly, share-based compensation expense is measured based on the estimated fair value of the awards on the date of grant, net of forfeitures. We recognize compensation expense for the portion of the award that is ultimately expected to vest over the period during which the recipient renders the required services to us using the straight-line single option method. In accordance with authoritative guidance, we remeasure the fair value of non-employee share-based awards as the awards vest, and recognize the resulting value, if any, as expense during the period the related services are rendered.

Significant Factors, Assumptions and Methodologies Used in Determining Fair Value

We apply the fair value recognition provisions of ASC Topic 718, Compensation-Stock Compensation, which we refer to as ASC 718. Determining the amount of share-based compensation to be recorded requires us to develop estimates of the fair value of stock options as of their grant date. For service period and performance based options we recognize share-based compensation expense ratably over the requisite service, which is the vesting period of the award. For exit event options we recognize share-based compensation expense upon the occurrence of an exit event as defined in the option grant agreement. Calculating the fair value of share-based awards requires that we make highly subjective assumptions.

As of June 30, 2014, we had 1,462,953 of time-vesting stock options awards outstanding, of which 950,979 were issued prior to 2011 with an exercise price between $4.64 and $6.56 and 857,918 were

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issued in January 2011 with an exercise price of $5.25. As noted above in the valuation of Series C Preferred Stock, we used a third party transaction to determine the fair value of our common stock in January 2011. Subsequent to January 2011, we issued approximately 12,668 time vesting stock option awards during 2012. No time vesting stock option awards have been issued subsequent to 2012. Additionally, as of June 30, 2014, we had 2,106,108 of performance vesting and exit event stock options awards outstanding, of which 2,006,608 were issued in January 2011 with an exercise price of $5.25. Subsequent to January 2011, we issued approximately 87,024 performance vesting and exit event stock option awards during 2012, and 22,000 during 2013. No performance vesting stock option awards have been issued subsequent to April 2013.

We use the Black-Scholes option pricing model to value our stock option awards. Use of this valuation methodology requires that we make assumptions as to the volatility of our common stock, the expected term of our stock options, the risk free interest rate for a period that approximates the expected term of our stock options and our expected dividend yield. We utilized our historical stock price as an indicator of volatility.

We use the simplified method as prescribed by the Securities and Exchange Commission Staff Accounting Bulletin No. 107, Share-Based Payment, to calculate the expected term of stock option grants to employees as we do not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term of stock options granted to employees. We utilize a dividend yield of zero based on the fact that we have never paid cash dividends and have no current intention to pay cash dividends. The risk-free interest rate used for each grant is based on the U.S. Treasury yield curve in effect at the time of grant for instruments with a similar expected life. The weighted-average assumptions used to estimate the fair value of stock options using the Black-Scholes option pricing model were as follows for the years ended December 31, 2013 and 2012 and for the six months ended June 30, 2014 and 2013:

	Year Ended December 31,						Six Months Ended June 30,
	2013			2012			2014 (1)		2013 (1)
Weighted-average exercise price of options granted	$	5.25		$	5.25			—		—
Expected volatility		91.2	%		86	%		—		—
Risk-free interest rate		1.2	%		1.7	%		—		—
Expected life of options (years)		7			7			—		—

(1) No options were granted for the six months ended June 30, 2013 and 2014.

We are also required to estimate forfeitures at the time of grant, and revise those estimates in subsequent periods if actual forfeitures differ from our estimates. We use historical data to estimate pre-vesting option forfeitures and record share-based compensation expense only for those awards that are expected to vest. To the extent that actual forfeitures differ from our estimates, the difference is recorded as a cumulative adjustment in the period the estimates were revised. Through June 30, 2014, actual forfeitures have not been material.

Share-based compensation expense was $1.1 million and $1.0 million for the years ended December 31, 2012 and 2013, respectively, and $0.5 million for the six months ended June 30, 2013 and 2014. As of December 31, 2013, we had $1.0 million of total unrecognized share-based compensation expense, which we expect to recognize over a weighted-average remaining vesting period of approximately three years. Additionally, there is $9.1 million of unrecognized compensation expense related to performance based and exit event option awards that we do not consider probable of vesting and accordingly have not recognized any expense.

If factors change or we employ different assumptions, stock-based compensation expense in future periods may differ significantly from what we have recorded in the past. If there is a difference between the

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assumptions used in determining stock-based compensation expense and the actual factors that become known over time, we may change the input factors used in determining stock-based compensation expense for future grants. These changes, if any, may materially impact our results of operations in the period such changes are made. We expect to continue to grant stock options in the future, and to the extent that we do, our actual stock-based compensation expense recognized in future periods will likely increase.

Fees on Debt Guarantee—On June 8, 2012, we entered into a Fee and Reimbursement Agreement whereby we and certain investors (the “Guarantors”) entered into agreements to guarantee a portion of our payment obligation with respect to the $62.5 Million Revolver, the Guarantors had determined that the Guarantee was the most advantageous means for protecting or enhancing the value of their existing equity investment and provided the guarantee solely for that purpose. The Guarantors earn a contingent fee equal to 10% per annum of the amount of the outstanding guarantee by such Guarantor pursuant to the credit agreement in the form of newly issued shares of our Series C Preferred Stock, par value $0.001 per share, at a price of $5.25 per share (the “Guarantee Preferred Stock Fee”). The Guarantee Preferred Stock Fee accrues only from and after the date that such Guarantor enters into the guarantee. If at any time a Guarantor’s obligation under the credit agreement or guarantee is terminated, in full or in part, the Guarantee Preferred Stock Fee will continue to accrue only with respect to the amount, if any, of such Guarantor’s remaining commitment under the credit agreement or Guarantee.

We recognized the Guarantee Preferred Stock Fee as a financial instrument and recorded a liability at fair value at time of issuance. The liability is remeasured to its fair value at each reporting period with changes recorded in the consolidated statement of operations and comprehensive loss. The liability will remain recorded until the debt is fully paid and Series C Preferred Stock is issued. We use a third party valuation firm to assist us with determining the fair value of the Guarantee Preferred Stock Fee.

Valuation of Fees on Debt Guarantee

In estimating the retrospective enterprise valuation of the Company at December 31, 2012, it was determined that the Income Approach—Discounted Cash Flow Model (“DCF”) was most reliable given the lack of expectation of a potential Initial Public Offering, potential acquisition, or other significant transaction. In order to allocate the enterprise value an Option Pricing Method (“OPM”) was used to determine an appropriate value for each tranche of equity and the resulting values were applied to each class of equity in order of preference.

In estimating the retrospective enterprise valuation of the Company at December 31, 2013, it was noted that during December 2013 the Company started to have discussions on a potential initial public offering with investment bankers. Based on these initial discussions it was determined that a Market Approach should be utilized in combination with an Income Approach. Based on the preliminary discussions and uncertainty on the possibility of a potential initial public offering, it was decided that the Income Approach—DCF should represent 80% of the enterprise valuation, with the remaining 20% represented by utilizing the Market Approach (utilizing guideline companies). Similar to December 31, 2012, the Option Pricing Method was utilized to allocate the enterprise valuation.

In estimating the retrospective enterprise valuation of the Company at June 30, 2014, it was noted that during the six months ended June 30, 2014 further progress was made towards an IPO, including interviewing investment banks to underwrite a proposed IPO. Based on further discussion, it was determined that in addition to an Income Approach and Market Approach, an approach that incorporated a potential IPO scenario should be utilized. Being that as of June 30, 2014, we had confidentially submitted our first draft registration statement on Form S-1 with the SEC we deemed it appropriate to have 20% of the total enterprise valuation using a potential IPO scenario valuation, with

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60% of the enterprise valuation represented by the Income Approach, and the remaining 20% by the Market Approach. Similar to the other valuation dates, the Option Pricing Method was utilized to allocate the enterprise valuation.

As of June 30, 2014, the balance of the liability was approximately $10.8 million.

Fair Value of Financial Instruments—Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).

The three levels of the fair value hierarchy are as follows:

• Level 1—Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities.

• Level 2—Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g. quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active). Level 2 includes financial instruments that are valued using models or other valuation methodologies.

• Level 3—Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.

The carrying amounts reported in the balance sheets for cash and cash equivalents, other receivables, accounts payable and accrued expenses approximate their fair value based on the short-term maturity of these instruments. The warrant liability is recorded at fair value with changes in fair value reflected in the statement of operations and comprehensive loss. Based on the borrowing rates then available to us for debt with similar terms and consideration of default and credit risk, the carrying value of the long term debt at June 30, 2014 (unaudited) and at December 31, 2013 approximated the fair value.

Basic and Diluted Net Loss Per Share of Common Stock—We compute basic net loss per share of common stock by dividing net loss applicable to common stockholders by the weighted average number of shares of common stock outstanding during the period, excluding the dilutive effects of preferred stock, warrants and stock options. We compute diluted net loss per share of common stock by dividing the net loss applicable to common stockholders by the sum of the weighted average number of shares of common stock outstanding during the period plus the potential dilutive effects of preferred stock and stock options outstanding during the period calculated in accordance with the treasury stock method, but such items are excluded if their effect is anti-dilutive. Because the impact of these items is anti-dilutive during periods of net loss, there was no difference between our basic and diluted net loss per share of common stock for the years ended December 31, 2012 and 2013, and for the six months ended June 30, 2014.

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JOBS Act

On April 5, 2012, the JOBS Act was enacted. Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have irrevocably elected not to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for other public companies.

We are in the process of evaluating the benefits of relying on other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if as an emerging growth company we choose to rely on such exemptions, we may not be required to, among other things, (i) provide an auditor’s attestation report on our systems of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive Officer’s compensation to median employee compensation. These exemptions will apply until we no longer meet the requirements of being an emerging growth company. We will remain an emerging growth company until the earliest of (i) the end of the fiscal year following the fifth anniversary of the completion of this offering, (ii) the first fiscal year after our annual gross revenue are $1.0 billion or more, (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities or (iv) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year.

Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

We are exposed to market risk from changes in interest rates on debt and changes in commodity prices. Our exposure to interest rate fluctuations is limited to our outstanding indebtedness under our credit agreements, which bears interest at variable rates. As of June 30, 2014, there was $82.5 million in outstanding borrowings under our Revolving Note Payable. A 1.0% increase or decrease in the effective interest rate applied on these loans would have resulted in a pre-tax interest expense fluctuation of $0.8 million on an annualized basis.

Commodity Price Risk

We purchase certain products that are affected by commodity prices and are, therefore, subject to price volatility caused by weather, market conditions and other factors which are not considered predictable or within our control. In many cases, we believe we will be able to address material commodity cost increases by either increasing prices or reducing operating expenses. However, increases in commodity prices, without adjustments to pricing or reduction to operating expenses, could increase our operating costs as a percentage of our net sales.

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Recent Accounting Pronouncements

In April 2014, the FASB issued ASU 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” (“ASU 2014-08”). Under ASU 2014-08, only disposals representing a strategic shift in operations that have a major effect on the Company’s operations and financial results should be presented as discontinued operations. Additionally, ASU 2014-08 requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The amendments in ASU 2014-08 are effective for fiscal years, and interim periods within those years, beginning after December 15, 2014. However, ASU 2014-08 should not be applied to a component that is classified as held for sale before the effective date even if the component is disposed of after the effective date. Early adoption is permitted, but only for disposals (or classifications as held for sale) that have not been reported in financial statements previously issued. The effects of ASU 2014-08 will depend on any future disposals by the Company.

In May 2014, FASB issued ASU 2014-09 “Revenue from Contracts with Customers” (Topic 606) (“ASU 2014-09”). This comprehensive new revenue recognition standard will supersede existing revenue recognition guidance and is intended to improve and converge revenue recognition and related financial reporting requirements. The standard will require companies to judgmentally examine its customer contracts ensuring all separate performance obligations are properly recognized in compliance with the new guidance. The standard is effective for public entities for annual and interim periods beginning after December 15, 2016 with early adoption prohibited. The Company is assessing whether the adoption of the guidance will have a significant impact on its consolidated financial statements.

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BUSINESS

Overview

We started Freshpet with a single-minded mission—to bring the power of real, fresh food to our dogs and cats. We were inspired by the rapidly growing view among pet owners that their dogs and cats are a part of their family, leading them to demand healthier pet food choices. Over the last eight years, we have created a comprehensive business model to deliver wholesome pet food that “pet parents” can trust, and in the process we believe we have become one of the fastest growing pet food companies in North America. Our business model is difficult for others to replicate and we see significant opportunity for future growth by leveraging the unique elements of our business:

Our Brand	We founded the fresh, refrigerated pet food category in North America and our brand transparently communicates our passion and dedication.
Our Product Know-How	Our fresh, refrigerated products are differentiated inside and out from conventional pet food as a result of our proprietary recipes, cooking techniques and packaging developed over the last eight years.
Our Freshpet Kitchens	All of our food is made in the United States, and we own and operate what we believe is North America’s only fresh, refrigerated pet food manufacturing facility, which we call the Freshpet Kitchens, located in Bethlehem, Pennsylvania.
Our Refrigerated Distribution	We are the only pet food company with an established refrigerated supply chain connecting our Freshpet Kitchens to retail stores across North America.
Our Freshpet Fridge	We sell our products through a fast-growing network of company-owned branded refrigerators, known as Freshpet Fridges, installed in over 12,500 retail stores across North America.
Our Culture	We foster a culture of innovation, and we strive to be open, honest and socially responsible in everything we do.

Freshpet is disrupting the $22.5 billion North American pet food industry by driving consumers to reassess conventional dog and cat food offerings that have remained essentially unchanged for decades. We position our brand to benefit from mainstream trends of growing pet humanization and consumer focus on health and wellness. We price our products to be accessible to the average consumer, providing us with broad demographic appeal and allowing us to penetrate multiple classes of retail including grocery, mass, club, pet specialty and natural. We have successfully expanded our network of Freshpet Fridges within leading blue-chip retail chains including Albertsons, BJ’s, Kroger, Petco, PetSmart, Publix, Safeway, Target, Wal-Mart and Whole Foods. The strength of our business model extends to our customers, who we believe find that Freshpet grows their pet category sales, drives higher traffic, increases shopper frequency and delivers category leading margins. As of June 30, 2014, Freshpet Fridges were located in over 12,500 stores, and we believe there is an opportunity to install a Freshpet Fridge in at least 35,000 stores across North America.

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Freshpet’s differentiated pet food empowers pet parents to provide positive nutrition and well-being to their pets. Our success is reflected in the growth we have delivered:

• Our Freshpet Fridge store locations increased from 7,001 in 2011 to 10,836 in 2013, representing a compounded annual growth rate of 24%; and as of June 30, 2014, we had 12,593 installed Freshpet Fridges representing 28% growth over the number as of June 30, 2013.

• Our net sales increased from $25.4 million in 2011 to $63.2 million in 2013, representing a compounded annual growth rate of 58%; and for the six months ended June 30, 2014, we reported net sales of $39.7 million representing growth of 38% over the six months ended June 30, 2013.

Freshpet Fridge Store Locations	Net Sales ($ millions)

• Our gross profit margin as a percent of net sales improved 610 basis points from 42.6% in the year ended December 31, 2011 to 48.7% in the six months ended June 30, 2014.

• Our net loss from operations decreased from $23.4 million in 2011 to $12.4 million in 2013; and for the six months ended June 30, 2014, we reported net loss of $5.6 million compared with a net loss of $6.4 million in the six months ended June 30, 2013.

• Our net loss decreased from $24.2 million in 2011 to $21.7 million in 2013; and for the six months ended June 30, 2014, we reported a net loss of $11.4 million compared with a net loss of $10.0 million in the six months ended June 30, 2013.

Our Industry

We compete in the North American dog and cat food market, which had 2013 retail sales of $22.5 billion and has grown at an average compounded annual growth rate of 3.6% from 2008 to 2013, according to Euromonitor. Of the total market, dog food, cat food, and treats & mixers accounted for retail sales of $12.1 billion, $6.8 billion, and $3.5 billion, respectively. The U.S. represented $20.8 billion or over 92% of North American dog and cat food sales. According to the American Pet Products Association, or APPA, U.S. pet food spending is expected to increase by 4.9% in 2014. The pet food market has historically been resilient as consumers continue to spend on their pets even during economic downturns. Within the pet food market, premium and/or natural brands are gaining market share, according to Packaged Facts. According to a 2013 report from Packaged Facts, from 2008 to 2012, natural pet food in the United States grew at a compounded annual growth rate of 18% and is expected to grow at an annual rate of 17% for 2012 to 2017.

We believe the following trends are driving growth in our industry:

Pet ownership.    There are currently 84.6 million pet-owning households in the United States, according to the APPA. The percentage of U.S. households with dogs or cats (or both) has increased from 47.8% in 2006 to 52.3% in 2013. More U.S. households today have pets than have children, which we believe to be a result of demographic shifts and changing attitudes towards pets.

Pet humanization.    According to Packaged Facts, 83% of U.S. pet owners view their pets as members of the family. As pets are increasingly viewed as companions, friends, and family members,

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pet owners are being transformed into “pet parents” who spare no expense for their loved ones, driving premiumization across pet categories. This trend is reflected in food purchasing decisions. Nearly 80% of U.S. pet owners are as concerned about the quality of their pet’s food as they are about their own, according to Market researcher Mintel.

Increasing consumer focus on health & wellness.    Consumers are increasingly purchasing fresh, natural, and organic food products. According to Euromonitor, from 2002 to 2013, the U.S. natural and organic food market grew at a compound annual growth rate of 9.8%, compared to the overall U.S. food market’s growth rate of 2.8%. We believe consumers are seeking simple, fresh and easy to understand food products from brands they trust and made with ingredients that are transparently sourced.

The pet food purchasing decision is underpinned by higher brand loyalty than many other consumer packaged goods categories. A consumer selecting a pet food brand resists frequent switching in order to avoid disrupting the pet’s diet, resulting in high repeat purchasing behavior. As a result, we believe that as consumers try fresh, refrigerated pet food, they are likely to become repeat users of the product.

Our Opportunity

Even though long-term consumer trends of pet humanization and health and wellness are well documented, conventional pet food sold as dry kibble or in wet cans has not changed substantially for decades. We believe that the pet food industry has not kept pace with how consumers think about food for their families, including their pets. As a result, consumers are searching for higher quality, less processed food for their dogs and cats—meals that measure up to today’s sensibilities of what actually constitutes “good food.” Freshpet was specifically designed to address this growing need with affordable offerings accessible to the average consumer.

Our Competitive Strengths

We believe that the following strengths differentiate Freshpet and position us to become a leading brand in pet food:

The category defining brand in fresh, refrigerated pet food.    Freshpet is the first and only fresh, refrigerated pet food brand distributed across North America. Our products represent a significant innovation in pet food, and we have developed a brand proposition that pet parents can intuitively trust.

All of our meats and vegetables are sourced in North America, and all our products are made in the United States. We use fresh and simple ingredients, over 70% of which are sourced locally within a 175 mile radius of the Freshpet Kitchens. None of our ingredients are sourced from China. We gently cook these ingredients using proprietary recipes and use no preservatives. Pet parents can easily recognize ingredients in our products as being similar to fresh food they buy for their families. In palatability tests commissioned by us and conducted by third party kennels, dogs chose Freshpet over other leading brands by a wide margin. In addition, according to a study commissioned by us and conducted by a third party researcher, pet parents perceived that Freshpet provides their pets with greater enthusiasm for eating and visible health improvements. By satisfying pet nutritional needs and strong pet parent motivations, we have built a growing base of loyal consumers who we believe have an emotional connection to the Freshpet brand.

Proven, scalable and defensible point-of-sale retail model.    We sell our products through a fast-growing network of company-owned branded refrigerators, or Freshpet Fridges, which are typically four feet wide by seven feet high, and replace standard shelving in the pet aisle or an end-cap of a

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retail store. We are the only company to have a branded refrigeration fixture, in-aisle electric power and significant exclusive shelf space in the pet department of leading national retail chains. The Freshpet Fridge is a significant competitive advantage as it provides us with a brightly-lit and highly-visible merchandising platform and control over how our brand is presented to consumers at the point of sale. We believe we have developed strong capabilities in the design, sourcing, installation and maintenance of these refrigerators. We believe our Freshpet Fridges generate compelling economics with an average cash-on-cash payback period of less than 15 months, calculated by comparing our total current costs for a refrigerator (including installation and maintenance) to our current margin on net revenues.

We have successfully installed Freshpet Fridges across all major classes of pet retail including grocery, mass, club, pet specialty and natural. Our track record of consistently growing the number of store locations with key customers underscores the success of our point-of-sale model.

Selected Customers	Year Entered		Freshpet Fridge Locations at Launch		Freshpet Fridge Locations as of August 1, 2014
Wal-Mart		2007		51		1,578
Petco		2007		97		1,337
PetSmart		2006		29		1,294
Target		2012		50		1,152
Kroger		2007		185		970
Whole Foods		2012		29		206

The pet category is of strategic importance to many of our customers due to the category size and frequency of purchase. Introducing Freshpet allows customers to offer consumers a new and innovative product that is aligned with consumer trends at an accessible price point for the average shopper. We believe our customers find that Freshpet grows sales of their overall pet category, drives higher traffic, increases shopper frequency and delivers category leading margins. We believe our attractive business proposition to customers will allow us to continue penetrating store locations of existing and new customers.

Difficult to replicate know-how, manufacturing facilities and supply chain.    We built and currently operate what we believe to be the only fresh, refrigerated pet food manufacturing facility in North America. Our facility was designed by us to operate at human-grade food quality and safety standards. Over the last eight years, we have developed proprietary in-house know-how in the areas of recipes, ingredients sourcing, cooking techniques and product packaging. We have established the only refrigerated pet food supply chain in North America, including warehousing, transportation and refrigeration at the point-of-sale. In addition to physical infrastructure, we have cultivated a team of professionals with unique skills in production and delivery of fresh, refrigerated pet food. As a result, our facilities, processes and people represent advantages that would be difficult for others to replicate.

Experienced, committed management team and company culture focused on core values.    We have a deep bench of management talent with a tremendous amount of pet industry experience and significant ownership in Freshpet. The majority of our senior executive team previously worked together to revitalize the Meow Mix brand and successfully sold it in 2006. Our CEO, Richard Thompson, served as CEO of The Meow Mix Company from 2002 to 2006 and previously founded the American Italian Pasta Company. Over time, we have grown this senior team with carefully selected individuals who possess substantial industry experience and share our core values.

Our core values span Pets, People and Planet. We produce the highest quality food for Pets and are active in pet-related charitable giving. We treat our People, including team members and partners, with respect and look to foster their growth alongside our own. We try to be good stewards of the

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Planet by using renewable energy and looking to constantly improve the efficiency of our operations. We believe our culture and values allow us to attract a passionate employee base while also helping pet parents connect with the Freshpet brand.

Our Growth Strategies

We intend to continue growing net sales and profitability through the following growth strategies:

Continue to grow awareness, trial and adoption to increase Freshpet’s North American market share.    We believe that Freshpet is in the nascent stages of penetrating the pet food market with our innovative fresh, refrigerated product offering. Our market share is currently less than 1% of the overall $22.5 billion North American pet food market. As of March 2014, less than 20% of U.S. pet food consumers had aided awareness of the Freshpet brand, which provides us a significant opportunity to grow over time.

We deploy a broad set of marketing tools to reach pet parents. We focus our marketing efforts on educating pet parents about the benefits of fresh, refrigerated food. Since 2011, we have strategically utilized national TV advertising to meaningfully drive sales productivity. More recently, our investments in social and digital media have spurred an active online community of enthusiastic pet parents that advocate for our products and drive “grass roots” education efforts about the benefits of fresh, refrigerated pet food to broaden our consumer reach. Freshpet also is active in public relations and event marketing initiatives utilizing our Freshpet food truck. In addition, our Freshpet Fridges serve as local brand ambassadors to introduce consumers to our brand in over 12,500 retail locations.

As a result of our marketing investments, consumer trial of Freshpet products has tripled from 2010 to 2013, and repeat purchase rates also increased significantly. In many retail accounts where Freshpet has been available for five years or more, we have achieved between 6% - 10% market share of dry and wet dog food sales. We believe that with growing awareness and availability of Freshpet, we have expansive runway to grow trial, adoption and market share.

Continue to grow points of distribution by installing new Freshpet Fridges.    We believe there is a significant opportunity to continue to grow our network of Freshpet Fridges by expanding within the store base of existing and new customers. We grew the number of Freshpet Fridge store locations by a compounded annual rate of 24% between 2011 and 2013. We operate Freshpet Fridges in more than 12,500 stores in North America, and we estimate that there is an opportunity to install a Freshpet Fridge in at least 35,000 retail locations across North America. Within our current footprint we believe we have the opportunity to double our store count at existing customers alone.

Over the next three years, we plan to install over             Freshpet Fridges in new retail locations. We have developed organizational resources and a national network of service providers to enable us to achieve this goal. We expect continued demand for our Freshpet Fridges driven by the strong business proposition and attractive margins that we deliver to customers.

Continue to deliver innovation in pet food and expand our product offerings.    As the first and only manufacturer of fresh, refrigerated pet food distributed across North America, product innovation is core to our business. We are continually working to develop new products that address a variety of consumer trends and preferences. Our innovations are designed to remain true to our founding mission—simple, fresh, good food—while expanding our base of consumers and usage occasions. For example, our Roasted Meals products mirror product trends in human food, and our Dog Joy Turkey Bacon treats offer an indulgent treat outside of regular meals. In 2013, new product introductions since 2011 represented 31% of our net sales.

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We have a strong innovation pipeline, including entirely new product platforms, that expand the breadth of our fresh offerings. We also see significant opportunity to expand into pet categories where we are underpenetrated. Over 93% of our 2013 net sales were derived from dog food, a segment that represents 52% of overall U.S. pet food retail sales. Other segments of pet food, including cat food and pet treats, represent compelling growth opportunities to expand our base of users and usage occasions. We expect that new product introductions will continue to meaningfully drive growth going forward.

Continue to enhance our operating margins.    We intend to enhance our operating margins through efficiencies of scale as we grow our net sales ahead of costs. We have made significant investments in management, manufacturing capacity, information systems and other infrastructure to enable us to pursue our growth. The Freshpet Kitchens currently operate with capacity utilization of approximately 50%, and we can double our production capacity through investments in expanding our existing site as our sales volumes grow.

From 2011 through the second quarter of 2014, we expanded our gross margins by approximately 610 basis points from 42.6% to 48.7% as a result of leveraging higher sales and cost efficiencies achieved from the new Freshpet Kitchens opened in the second half of 2013. We expect that gross margin improvement and operating leverage from SG&A costs will be a significant driver of earnings growth going forward.

Our Mission and Values

We started Freshpet with a single-minded mission—to bring the power of real, fresh food to our dogs and cats. And, we are committed to doing so in ways that are good for Pets, People and Planet.

Pets

Our pets are members of our family and deserve to eat the kind of fresh, healthy food that we do. We cook our fresh, nutritious pet food with the same care that we would take in preparing human food. Through the Freshpet Foundation, we support nutritional research in areas of prevention, care and treatment of diseases in dogs. Since founding Freshpet, we have donated over two million fresh meals to pets via shelters, charitable organizations and humane societies. Our team members get paid time off to pursue activities that help pets in their community. We also participate in Random Acts of Kindness to do our part to improve the lives of pets and pet parents.

People

People include our team members, our partners and pet parents. We treat our team members with respect and are committed to helping them develop professionally and personally. We try to be good partners with customers, distributors and suppliers by conducting business with honesty and transparency. Additionally, we strive to help pet owners by providing pet parenting resources.

Planet

We are committed to being socially responsible and minimizing our environmental impact. The electricity used in the Freshpet Kitchens is 100% wind-powered. We also strive to conserve energy by continually improving the efficiency of our Freshpet Fridges and partnering with freight and logistics providers committed to sustainable practices.

Our commitment to our values helps us engage with consumers, motivate our team members and attract strong partners, which allows us to fulfill our mission of delivering the best nutritional product choices to improve the well-being of our pets, enrich pet parents’ lives and contribute to communities. Freshpet—Pets, People, Planet.

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Our Products

Our products consist of dog food, cat food and dog and cat treats. All Freshpet products are made according to our nutritional philosophy of fresh, meat-based nutrition and minimal processing. Our proprietary recipes include real, fresh meat and varying combinations of vitamin-rich vegetables, leafy greens and anti-oxidant rich fruits, without the use of preservatives, additives or artificial ingredients. Our unique product attributes appeal to diverse consumer needs across multiple classes of retail where Freshpet is sold. Consequently, our brand resonates across a broad cross-section of pet parent demographics.

All of our products are sold under the Freshpet brand name, with ingredients, packaging and labeling customized by class of retail. Our products are available in multiple forms, including slice and serve rolls, bagged meals and tubs. The following is a summary of our primary classes of retail and corresponding product offerings:

Class of Retail	Mass Merchandisers & Traditional Grocery	Pet Specialty	Natural Grocers
Launch	Launched in 2006	Launched in 2010	Launched in 2012
Primary Packaging
Selected Products

We also offer fresh and frozen treats across all classes of retail under the Dognation and Dog Joy labels, which accounted for 13% of total net sales in 2013.

Our Product Innovation

As the first and only manufacturer of fresh, refrigerated pet food distributed across North America, product innovation is core to our strategy. We take a fresh approach to pet food and are not constrained by conventional pet food products, attributes and production capabilities. We employ a tightly-knit, creative team of marketing and research and development professionals, and we consult with outside experts through our Nutrition Council, which includes leading microbiologists and veterinary nutritionists. Our team often identifies pet parents’ needs by evaluating emerging demand trends in both pet food and human food. Our fully equipped research and development facility located near the Freshpet Kitchens tests small batches of new recipes and tries out new cooking techniques. New products are refined iteratively with the help of consumer panel data to arrive at products that we believe can be commercially successful.

The success of our approach is evidenced by our broad product portfolio today. We began Freshpet by producing fresh, refrigerated slice and serve rolls, and over time have steadily expanded

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into successful new product forms including bags, tubs and treats. We also introduced new recipes and ingredients, such as proteins and grain-free options, never before seen in pet food that cater to the specific dietary requirements of pets.

For the year ended 2013, new product introductions since 2011 represented 31% of our net sales. We have a strong innovation pipeline, including entirely new product platforms, that expand the breadth of our fresh offerings. We expect that new product introductions will continue to meaningfully drive growth going forward.

Our Supply Chain

Manufacturing:    All of our products are manufactured in the United States. We own and operate what we believe to be the only fresh, refrigerated pet food manufacturing facility in North America, the Freshpet Kitchens at Bethlehem, Pennsylvania. This new 58,000 square foot facility completed in 2013 was built to human grade food standards and houses two production lines customized to produce fresh, refrigerated food. In 2013, 94% of our product volume was manufactured by us. For manufacture of some low volume products, we strategically partner with a select group of contract manufacturers that operate human food manufacturing facilities.

Ingredients and Packaging:    Our products are made with natural and fresh ingredients including meat, vegetables, fruits, whole grains, vitamins and minerals. We use high quality food grade plastic packaging materials. Over 70% of our ingredients are sourced locally from within a 175 mile radius of the Freshpet Kitchens, 97% are from North America and none are sourced from China. We maintain rigorous standards for ingredient quality and safety. By volume, our largest input, antibiotic-free fresh chicken, represents approximately 50% of total ingredients. In order to retain operating flexibility and negotiating leverage, we do not enter into exclusivity agreements or long term commitments with any of our suppliers. All of our suppliers are well-established companies that have the scale to support our growth. For every ingredient, we either use multiple suppliers or have identified alternative sources of supply that meet our quality and safety standards.

Distribution:    Outbound transportation from our facility is handled through a partnership with a leading human food manufacturer, which also warehouses and delivers our refrigerated products to grocery retail accounts across North America. This partnership is governed by a written agreement pursuant to which our products are stored and shipped on a cost-plus basis. As a result, as our volumes grow, we expect to be able to leverage our distribution costs. We use national and regional distributors to cover the mass, pet specialty and natural retail classes. Our agreements with other distributors are based on regional mutual exclusivity within each region for the fresh refrigerated pet category.

Our Product Quality & Safety

We go to great lengths to ensure product quality, consistency and safety from ingredient sourcing to finished product. Our company-owned manufacturing facility allows us to exercise significant control over production. Our quality assurance team includes nine professionals with significant experience in pet and human food production.

Our production processes are designed to meet science-based quality standards with documented plans for Hazard Analysis Critical Control Points and Hazard Analysis Risk Based Preventive Control to monitor established production controls, calibrate instruments, record data and perform corrective actions. Our on-site laboratory has microbial and composition testing capabilities. Quality control approvals are based on a positive release strategy, wherein a batch can only be

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shipped when it passes control point record reviews and laboratory testing. At the end of each working day, a third shift consisting of a cleaning crew sanitizes all equipment that is in contact with food material. Before commencing production the next day, quality assurance professionals swab equipment to test for potential contaminants.

Freshpet’s food safety program is certified at Safe Quality Food Level III, which is the highest standard determined under the Global Food Safety Initiative Benchmarks. We believe our systems and standards for product quality and safety can support our growth and ensure continued success in the market.

Our Customers and Distributors

We sell our products throughout North America, generating the vast majority of our sales in the United States. The strength of our business model makes us an attractive partner for leading blue-chip retailers, who we believe find that Freshpet grows the sales of their pet category, drives higher traffic, increases shopper frequency and delivers category-leading margins. Our Freshpet Fridge locations have been consistently increasing as we add new retail accounts and add stores in existing accounts. We are in over 12,500 stores and believe there is opportunity for us to install a Freshpet Fridge in at least 35,000 stores in North America. We sell our products through the following classes of retail: grocery, mass, club, pet specialty and natural.

Evolution of Store Count by Class of Retail

(1) We began selling in the natural retail class in 2012.

Our customers determine whether they wish to purchase our products either directly from us or through a third party distributor. In 2013, our largest distributor by net sales, McLane Company, Inc., which sells to three of our customers, including Wal-Mart and Target, accounted for 28% of our net sales. Kroger, a customer which purchases directly from us, accounted for 11% of our net sales in 2013. No other distributor or customer accounted for more than 10% of our net sales in 2013.

The Freshpet Fridge

We sell our products through a growing network of company-owned branded refrigerators, the Freshpet Fridges. Our Freshpet Fridges are typically four feet wide by seven feet high, and replace standard shelving in the pet aisle or an end-cap of a retail store. Our Freshpet Fridge designs are constantly evolving with all new models featuring prominent edge-lit LED headers, LED interior lighting, crisp black interiors, and frameless glass swing doors for aesthetics and easy access. We use state-of-the-art refrigeration technology and environmentally friendly refrigerants to minimize energy consumption and environmental impact.

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We design, produce, install and maintain the Freshpet Fridge through a combination of in-house resources and world-class partners. We source our Freshpet Fridges from three leading global commercial refrigerator manufacturers with whom we have a collaborative approach to refrigerator design and innovation. Once ordered by us, Freshpet Fridges are shipped to distribution centers for delivery and installation in retail stores.

Installation into retail locations and ongoing maintenance of the Freshpet Fridge is coordinated by Freshpet and executed through leading third-party service providers. All of our Freshpet Fridges are protected by a manufacturer warranty for one to three years. Our refrigerators are designed to be highly reliable, and at any given time less than 1% of the network is out of service for maintenance. Moreover, to ensure quality, cleanliness and appropriate in-stock levels, we employ brokerage partners to conduct a physical audit of the Freshpet Fridge network on an ongoing basis, with photographic results of every Freshpet Fridge in the network transmitted back to Freshpet and reviewed by members of our sales team.

We currently estimate less than 15 month cash-on-cash payback for the average Freshpet Fridge installation, calculated by comparing our total current costs for a refrigerator (including installation and maintenance) to our current margin on net revenues. We believe our attractive value proposition to retailers and pet parents will allow us to continue penetrating store locations of existing and new customers. The Freshpet Fridge provides a highly-visible merchandising platform, allows us to control how our brand is presented to consumers at point-of-sale and represents a significant point of differentiation from other pet food competitors.

Marketing and Advertising

Our marketing strategy is designed to educate consumers about the benefits of fresh refrigerated pet food and build awareness of the Freshpet brand. We deploy a broad set of marketing tools across television, digital and public relations to reach consumers through multiple touch points and increase product trials.

Our network of over 12,500 branded Freshpet Fridges in prominent locations within blue-chip retailers helps to introduce consumers to our brand and instantly distinguish Freshpet from traditionally merchandised pet food. Since 2011, we have effectively used national TV advertising to drive incremental consumers to try Freshpet products. We expect to realize greater benefits from national TV advertising as we continue to grow the network of Freshpet store locations nationwide. More recently, we have expanded our online presence to better target consumers seeking information on healthy pet food. We reach consumers across multiple digital and social media platforms including websites, blogs and online reviews, as well as with tailored messaging on popular digital hubs including Facebook, Twitter and YouTube. Our public relations strategy includes event marketing and the use of our Freshpet truck to create buzz among pet parents at high pet traffic areas.

Our marketing strategy has allowed us to drive new consumers to our brand and develop a highly engaged community of users who actively advocate for Freshpet.

Competition

Pet food is a highly competitive industry. We compete with manufacturers of conventional pet food such as Mars, Nestlé and Big Heart Pet Brands. We also compete with specialty and natural pet food manufacturers such as Colgate-Palmolive, Blue Buffalo and Merrick. In addition, we compete with many regional niche brands in individual geographic markets.

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Given a North American retail landscape dominated by large retailers, with limited shelf space and a significant number of competing products, competitors actively support their brands through marketing, advertising, promotional spending and discounting.

Competitive factors in the pet food industry include product quality, ingredients, brand awareness and loyalty, product variety, product packaging and design, reputation, price, advertising, promotion and nutritional claims. We believe that we compete effectively with respect to each of these factors. Moreover, our fresh, refrigerated product offering and secured shelf space in the form of the Freshpet Fridge offer significant advantages against competitors.

Team Members

As of June 30, 2014, we had 150 employees all of whom are located in the United States. None of our employees is represented by a labor union or by any collective bargaining arrangements with respect to his or her employment with us.

Properties

Our corporate headquarters is currently located in Secaucus, New Jersey and consists of approximately 14,815 square feet of office space and is subject to a lease agreement that expires on January 31, 2017.

We own the Freshpet Kitchens, our manufacturing facility in Bethlehem, Pennsylvania, which consists of approximately 58,470 square feet. We lease a manufacturing facility in Quakertown, Pennsylvania, which consists of approximately 6,500 square feet. The lease agreement expires on April 1, 2015, and we do not expect to renew it as we consolidate all in-house manufacturing at the Freshpet Kitchens. We believe that our properties have been adequately maintained, are in good condition generally and are suitable and adequate for its business as presently conducted.

Trademarks and Other Intellectual Property

We believe that our rights in our trademarks and service marks are important to our marketing efforts to develop brand recognition and differentiate our brand from our competitors and are a valuable part of our business. We own a number of trademarks and service marks that have been registered, or for which applications are pending, with the United States Patent and Trademark Office including, among others, Freshpet, Vital, Nature’s Fresh, Roasted Meals, Freshpet Dog Joy Treats and Dognation.

We believe that our intellectual property has substantial value and has significantly contributed to our success to-date. We are continually developing new technology and enhancing proprietary technology related to our pet food, Fridges and manufacturing operations.

We also rely on unpatented proprietary expertise, recipes and formulations, continuing innovation and other trade secrets to develop and maintain our competitive position.

Government Regulation

Along with our brokers, distributors, and ingredients and packaging suppliers, we are subject to extensive laws and regulations in the United States by federal, state and local government authorities. In the United States, the federal agencies governing the manufacture, distribution and advertising of

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our products include, among others, the FTC, the FDA, the USDA, the United States Environmental Protection Agency and the Occupational Safety and Health Administration. Under various statutes, these agencies, among other things, prescribe the requirements and establish the standards for quality and safety and regulate our marketing and advertising to consumers. Certain of these agencies, in certain circumstances, must not only approve our products, but also review the manufacturing processes and facilities used to produce these products before they can be marketed in the United States. We are also subject to the laws of Canada, including the Canadian Food Inspection Agency, as well as provincial and local regulations.

We are subject to labor and employment laws, laws governing advertising, privacy laws, safety regulations and other laws, including consumer protection regulations that regulate retailers or govern the promotion and sale of merchandise. Our operations, and those of our distributors and suppliers, are subject to various laws and regulations relating to environmental protection and worker health and safety matters. We monitor changes in these laws and believe that we are in material compliance with applicable laws.

Information Systems

We employ a comprehensive enterprise resource planning (ERP) system provided and supported by a leading global software partner. This system covers order entry, customer service, accounts payable, accounts receivable, purchasing, asset management and manufacturing. Our order management process is automated via Electronic Data Interchange with virtually all our customers, which feeds orders directly to our ERP platform. From time to time, we enhance and complement the system with additional software. We are currently expanding our ERP system with a Warehouse Management System which will allow us to improve tracking and management of ingredients, streamline manufacturing and provide the ability to ship direct to customers. We expect the system to be operational by the last quarter of 2014.

We backup data every hour and store a copy locally for immediate restoration if needed. All data is transmitted to a secure offsite cloud storage service daily for disaster recovery needs. We believe our systems infrastructure is scalable and can support our future growth.

Legal Proceedings

We are currently involved in various claims and legal actions that arise in the ordinary course of our business, including claims resulting from employment related matters. None of these claims, most of which are covered by insurance, has had a material effect on us, and as of the date of this prospectus, we are not party to any material pending legal proceedings and are not aware of any claims that could have a material adverse effect on our business, financial condition, results of operations or cash flows. However, a significant increase in the number of these claims or an increase in amounts owing under successful claims could materially and adversely affect our business, financial condition, results of operations or cash flows.

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MANAGEMENT

Set forth below is the name, age (as of June 25, 2014), position and a description of the business experience of each of our executive officers and each of our post-IPO directors:

Name	Age	Position(s)
Charles A. Norris	68	Chairman of the Board and Director
Richard Thompson	62	Director and Chief Executive Officer
J. David Basto	41	Director
Jonathan S. Marlow	34	Director
Richard Kassar	67	Chief Financial Officer
Scott Morris	45	Chief Marketing Officer
Cathal Walsh	42	Senior Vice President of Cooler Operations
Michael Hieger	40	Senior Vice President of Manufacturing Operations
Stephen Macchiaverna	56	Senior Vice President, Controller and Secretary
Thomas Farina	49	Senior Vice President of Sales
Kathryn Winstanley	34	Vice President of Marketing

Background of Directors and Executive Officers

Chairman of the Board and Director—Charles A. Norris has been a member of our Board of Directors and Chairman of the Board since October 2006. Mr. Norris has served as the Chairman of Glacier Water Services Inc. since 2001 and is also a member of the board of directors of AEM Electronics Inc., a position he has held since 2004. Mr. Norris is the retired President of McKesson Water Products Company, a bottled water company and division of McKesson Corporation, where he served as President from 1990 until he retired in October 2000. From 1981 through 1989, Mr. Norris served as President of Deer Park Spring Water Company, which was a division of Nestle USA, and then led an investor group that acquired the business in 1985 until it was sold to Clorox in 1987. Mr. Norris remained an executive officer of Clorox through 1989 following their acquisition of Deer Park. From 1973 to 1985, Mr. Norris served in various operational executive positions with Nestle in both Switzerland and the United States. Mr. Norris provides the Board of Directors with extensive corporate leadership experience as well as a deep understanding of our business.

Director and CEO—Mr. Richard Thompson has been a member of our Board of Directors since December 2010 and has served as Chief Executive Officer since January 2011 when MidOcean made its initial investment in us. From 2007 to 2010, Mr. Thompson made investments in various businesses including ZooToo, an online community for pet lovers. He served as Chief Executive Officer of The Meow Mix Company from 2002 until its sale to Del Monte Foods in 2006. Mr. Thompson has been involved in a number of successful ventures, including the American Italian Pasta Company, which he founded in 1985 and where he served as its President and Chief Executive Officer from 1986 to 1991. Mr. Thompson provides the Board of Directors with knowledge of the daily affairs of the Company, public company experience and expertise in the consumer products industry.

Director—J. David Basto has been a member of our Board of Directors since December 2010. Mr. Basto is Founding Partner and Managing Director of Broad Sky Partners, a position he has held since its formation in 2013. Prior to co-founding Broad Sky Partners, Mr. Basto worked for MidOcean from its inception in 2003 through 2013, most recently as Managing Director and co-head of MidOcean’s consumer sector investing team. Prior to MidOcean, Mr. Basto worked for DB Capital Partners and its predecessor BT Capital Partners from 1998 through 2003. Previously, Mr. Basto held positions with Juno Partners and Tucker Anthony Inc. Mr. Basto currently serves on the board of directors of South Beach Diet Corp. Mr. Basto provides the Board of Directors with expertise in analyzing financial issues and insights into the consumer sector.

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Director—Jonathan S. Marlow has been a member of our Board of Directors since December 2010. Mr. Marlow is a Principal at MidOcean, and has been with the firm since 2009, where he has focused on investments within the consumer sector. Prior to MidOcean, Mr. Marlow worked for Investcorp International Inc. in the private equity group from 2006 through 2008. Previously, Mr. Marlow held positions at J.F. Lehman & Company and Bear, Stearns & Co. Inc. Mr. Marlow currently serves on the board of directors of Agilex Fragrances. Mr. Marlow provides the Board of Directors with expertise in investment strategies and insight into the consumer sector.

CFO—Mr. Richard Kassar has served as Chief Financial Officer since January 2011. He previously served as our Chief Executive Officer from July 2006 to January 2011 and as President from January 2011 to June 2014. Mr. Kassar has acted as our principal financial and accounting officer since 2006. Prior to joining Freshpet, he was Senior Vice President and Chief Financial Officer of The Meow Mix Company until its sale to Del Monte Foods in 2006. From 1999 to 2001, he served as Co-President and Chief Financial Officer of Global Household Brands. From 1986 to 1999, Mr. Kassar was employed by Chock Full O’ Nuts in various positions and most recently served as Senior Vice President, Chief Operating Officer and Corporate Controller. Mr. Kassar has been a director of World Fuel Services Corporation since 2002. Mr. Kassar has over 20 years’ experience in the consumer brands industry.

CMO & Co-Founder—Mr. Scott Morris is a co-founder of Freshpet and has served as Senior Vice President of Sales and Marketing from 2010 to 2013 and Chief Marketing Officer since January 2014. Mr. Morris is involved in all aspects of Company development and day-to-day operations. Prior to joining Freshpet, Mr. Morris was Vice President of Marketing at The Meow Mix Company from 2002 to 2006. Previously, Mr. Morris worked at Ralston Purina from 1990 to 2002, holding various leadership positions in Sales and Marketing, most recently Pet Food Group Director. Mr. Morris founded The Freshpet Foundation, a 501(c)(3) non-profit charitable organization. He has over 20 years’ experience in consumer packaged goods sales, management and marketing.

SVP Cooler Operations & Co-Founder—Mr. Cathal Walsh is a co-founder of Freshpet and has served as Senior Vice President of Cooler Operations since January 2011 and previously served as our Chief Operating Officer from October 2006 to January 2011. Prior to joining Freshpet, Mr. Walsh was Zone Marketing Manager at Nestlé Worldwide from 2000 to 2005 and was Marketing Manager at Nestlé Pet Care from 1996 to 2000. Mr. Walsh has over 16 years’ experience in packaged goods marketing, sales and management, including in international food markets.

SVP Manufacturing Operations—Mr. Michael Hieger has served as Senior Vice President of Manufacturing Operations since January 2014. Mr. Hieger was Vice President of Manufacturing Operations from 2007 to 2013. In addition to plant-wide day-to-day activities, he is involved in new product development and co-manufacturing operations. Prior to joining Freshpet, Mr. Hieger focused on dry pet food extrusion as the Engineering Manager with The Meow Mix Company from 2002 to 2006 and as the Pet Treats Manager with Ralston Purina from 1997 to 2002. Mr. Hieger has over 17 years’ experience in pet food manufacturing.

SVP, Controller & Secretary—Mr. Stephen Macchiaverna has served as Senior Vice President, Controller and Secretary since October 2006. Prior to joining Freshpet, Mr. Macchiaverna was the Controller for The Meow Mix Company from its inception in 2002 through its sale and transition to Del Monte Foods in 2006. From 1999 to 2001, he was the Vice President of Finance and Treasurer of Virgin Drinks USA, Inc. Mr. Macchiaverna began his consumer packaged goods career with First Brands Corporation, where he worked from 1986 to 1999, most recently as Divisional Controller for all domestic subsidiaries. He has over 25 years’ experience in consumer packaged goods financial management.

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SVP Sales—Mr. Thomas Farina has served as Senior Vice President of Sales since January 2013 and as our Eastern Region Vice President from 2006 to 2013. Before joining Freshpet, Mr. Farina worked as Eastern Region Vice President at The Meow Mix Company from 2001 to 2006. From 1989 to 1995, Mr. Farina held various positions with American Home Food Products and after its sale, he worked in various positions at International Home Foods from 1996 to 2000, including Regional Vice President. Mr. Farina has over 25 years’ experience in consumer packaged goods.

VP Marketing—Ms. Kathryn Winstanley has served as Vice President of Marketing since 2006. Prior to joining Freshpet, Ms. Winstanley was a Senior Brand Manager at The Meow Mix Company from 2004 to 2006 and was a Brand Manager at Snapple Beverage Group from 2001 to 2003. She has over 13 years’ experience in consumer packaged goods marketing and management.

Family Relationships

There are no family relationships among any of our directors or executive officers.

Corporate Governance and Board Structure

Our Board of Directors currently consists of             members.

In accordance with our Certificate of Incorporation and Bylaws that will become effective upon consummation of this offering, our Board of Directors will consist of             members and will be divided into three classes with staggered three-year terms. At each annual general meeting of stockholders, the successors to directors whose terms then expire will be elected to serve from the time of election and qualification until the third annual meeting following election. The authorized number of directors may be changed by resolution of the Board of Directors. Vacancies on the Board of Directors can be filled by resolution of the Board of Directors.             serves as the Chairman of our Board of Directors. We believe that each of the following directors are independent as required by the rules of the             :             .             and             are the Class I directors and their terms will expire in 2015.             ,             and             are the Class II directors and their terms will expire in 2016.             and             are the Class III directors and their terms will expire in 2017. The division of our Board of Directors into three classes with staggered three-year terms may delay or prevent a change of our management or a change in control.

Mr. Norris serves as a managing member of Freshpet Investors LLC and Mr. Marlow serves as a principal of MidOcean. See “Principal and Selling Stockholders” and “Certain Relationships and Related Party Transactions—Stockholders Agreement.”

Board Committees

Until the completion of this offering, we will have no separate board committees. Upon completion of this offering, our Board of Directors will have three standing committees: an Audit Committee, a Nominating and Corporate Governance Committee and a Compensation Committee. Each of the committees will report to the Board of Directors as they deem appropriate, and as the Board of Directors may request. The expected composition, duties and responsibilities of these committees are set forth below. In the future, our Board of Directors may establish other committees, as it deems appropriate, to assist it with its responsibilities.

Audit Committee

The Audit Committee is responsible for, among other matters: (1) appointing, compensating, retaining, evaluating, terminating and overseeing our independent registered public accounting firm; (2) discussing with our independent registered public accounting firm their independence from

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management; (3) reviewing with our independent registered public accounting firm the scope and results of their audit and the audit fee; (4) approving all audit and permissible non-audit services to be performed by our independent registered public accounting firm, including taking into consideration whether the independent auditor’s provision of any non-audit services to us is compatible with maintaining the independent auditor’s independence; (5) overseeing the financial reporting process and discussing with management and our independent registered public accounting firm the interim and annual consolidated financial statements that we file with the SEC; (6) reviewing and monitoring our accounting principles, accounting policies, financial and accounting controls and compliance with legal and regulatory requirements; (7) establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters; (8) reviewing and approving related person transactions; (9) annually reviewing the Audit Committee charter and the committee’s performance; and (10) handling such other matters that are specifically delegated to the Audit Committee by our Board of Directors from time to time.

Upon completion of this offering, our Audit Committee will consist of             ,             and             . The SEC rules and the             rules require us to have one independent Audit Committee member upon the listing of our common stock on the             , a majority of independent directors on the Audit Committee within 90 days of the date of the completion of this offering and all independent Audit Committee members within one year of the date of the completion of this offering. Our Board of Directors has affirmatively determined that             and             meet the definition of “independent directors” for purposes of serving on an Audit Committee under applicable SEC and             rules, and we intend to comply with these independence requirements within the time periods specified. In addition,             will qualify as our “audit committee financial expert,” as such term is defined in Item 407 of Regulation S-K.

Our Board of Directors will adopt a new written charter for the Audit Committee, which will be available on our corporate website at www.freshpet.com upon the completion of this offering. Our website is not part of this prospectus.

Nominating and Corporate Governance Committee

The nominating and corporate governance committee will be responsible for developing and recommending to the Board of Directors criteria for identifying and evaluating candidates for directorships and making recommendations to the Board of Directors regarding candidates for election or reelection to the Board of Directors at each annual stockholders’ meeting. In addition, the nominating and corporate governance committee will be responsible for overseeing our corporate governance guidelines and reporting and making recommendations to the Board of Directors concerning corporate governance matters. The nominating and corporate governance committee will be also responsible for making recommendations to the Board of Directors concerning the structure, composition and function of the Board of Directors and its committees.

Upon completion of this offering, our Nominating and Corporate Governance Committee will consist of             ,             and             . The SEC rules and the             rules require us to have one independent Nominating and Corporate Governance Committee member upon the listing of our common stock on the             , a majority of independent directors on the Nominating and Corporate Governance Committee within 90 days of the date of the completion of this offering and all independent Nominating and Corporate Governance Committee members within one year of the date of the completion of this offering. Our Board of Directors has affirmatively determined that             ,             and             meet the definition of “independent directors” for purposes of serving on a Nominating and Corporate Governance Committee under applicable SEC and             rules, and we intend to comply with these independence requirements within the time periods specified.

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Our Board of Directors will adopt a new written charter for the Nominating and Corporate Governance Committee, which will be available on our corporate website at www.freshpet.com upon the completion of this offering. The information contained on our website does not constitute a part of this prospectus.

Compensation Committee

The Compensation Committee will be responsible for, among other matters: (1) reviewing key employee compensation goals, policies, plans and programs; (2) reviewing and approving the compensation of our directors, chief executive officer and other executive officers; (3) reviewing and approving employment agreements and other similar arrangements between us and our executive officers; and (4) administering our stock plans and other incentive compensation plans.

Upon completion of this offering, our Compensation Committee will consist of             ,             and             . The SEC rules and the             rules require us to have one independent Compensation Committee member upon the listing of our common stock on the             , a majority of independent directors on the Compensation Committee within 90 days of the date of the completion of this offering and all independent Compensation Committee members within one year of the date of the completion of this offering. Our Board of Directors has affirmatively determined that             ,             and             meet the definition of “independent directors” for purposes of serving on a Compensation Committee under applicable SEC and             rules, and we intend to comply with these independence requirements within the time periods specified.

Our Board of Directors will adopt a new written charter for the Compensation Committee, which will be available on our corporate website at www.freshpet.com upon the completion of this offering. The information contained on our website does not constitute a part of this prospectus.

Risk Oversight

Our Board of Directors is currently responsible for overseeing our risk management process. The Board of Directors focuses on our general risk management strategy and the most significant risks facing us and ensures that appropriate risk mitigation strategies are implemented by management. The Board of Directors is also apprised of particular risk management matters in connection with its general oversight and approval of corporate matters and significant transactions.

Upon completion of this offering, our Board of Directors will not have a standing risk management committee, but rather will administer this oversight function directly through our Board of Directors as a whole, as well as through various standing committees of our Board of Directors that address risks inherent in their respective areas of oversight. In particular, our Board of Directors will be responsible for monitoring and assessing strategic risk exposure, our Audit Committee will be responsible for overseeing our major financial risk exposures and the steps our management has taken to monitor and control these exposures and our Compensation Committee will assess and monitor whether any of our compensation policies and programs has the potential to encourage unnecessary risk-taking. In addition, upon completion of this offering, our Audit Committee will oversee the performance of our internal audit function and consider and approve or disapprove any related-party transactions.

Our management is responsible for day-to-day risk management. This oversight includes identifying, evaluating, and addressing potential risks that may exist at the enterprise, strategic, financial, operational, compliance and reporting levels.

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Risk and Compensation Policies

Prior to the completion of this offering, we intend to analyze our compensation programs and policies to determine whether those programs and policies are reasonably likely to have a material adverse effect on us.

Leadership Structure of the Board of Directors

The positions of Chairman of the Board and Chief Executive Officer are presently separated. We believe that separating these positions allows our Chief Executive Officer to focus on our day-to-day business, while allowing the Chairman of the Board to lead the Board of Directors in its fundamental role of providing advice to and independent oversight of management. Our Board of Directors recognizes the time, effort and energy that the Chief Executive Officer is required to devote to his position in the current business environment, as well as the commitment required to serve as our Chairman, particularly as the Board of Directors’ oversight responsibilities continue to grow. While our Bylaws and corporate governance guidelines do not require that our Chairman and Chief Executive Officer positions be separate, our Board of Directors believes that having separate positions is the appropriate leadership structure for us at this time and demonstrates our commitment to good corporate governance.

Compensation Committee Interlocks and Insider Participation

None of our executive officers currently serves, or in the past year has served, as a member of the board of directors or compensation committee of any entity that has one or more executive officers serving on our Board of Directors or Compensation Committee.

Code of Ethics

We will adopt a written General Code of Ethics (“General Code”) which applies to all of our directors, officers and other employees, including our principal executive officer, principal financial officer and controller. In addition, we will adopt a written Code of Ethics for Executive Officers and Principal Accounting Personnel (“Code of Ethics”) which applies to our principal executive officer, principal financial officer, controller and other designated members of our management. Copies of each code will be available on our corporate website www.freshpet.com upon completion of this offering. The information contained on our website does not constitute a part of this prospectus. We will provide any person, without charge, upon request, a copy of our General Code or Code of Ethics. Such requests should be made in writing to the attention of our Corporate Secretary at the following address: Freshpet, Inc., 400 Plaza Drive, 1^st Floor, Secaucus, New Jersey 07094.

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EXECUTIVE COMPENSATION

This section describes the material elements of compensation awarded to, earned by or paid to each of our named executive officers (the “NEOs”) in fiscal 2013. Our NEOs for 2013 are Richard Thompson, who served as our Chief Executive Officer during 2013, Scott Morris, who served as our Chief Marketing Officer during 2013, and Cathal Walsh, who served as our Senior Vice President during 2013. This section also provides qualitative information regarding the manner and context in which compensation is awarded to and earned by our executive officers and is intended to place in perspective the data presented in the tables and narrative that follow.

Compensation Philosophy and Objectives

Our compensation philosophy is to align executive compensation with the interests of our stockholders and therefore to financial objectives that our Board of Directors believes are primary determinants of long-term stockholder value. The primary goal of our executive compensation program is to ensure that we hire and retain talented and experienced executives who are motivated to achieve or exceed our short-term and long-term corporate goals. Our executive compensation programs are designed to reinforce a strong pay-for-performance orientation and to serve the following purposes:

• to reward our NEOs for sustained financial and operating performance and leadership excellence;

• to align their interests with those of our stockholders; and

• to encourage our NEOs to remain with us for the long-term.

Elements of Compensation

Base Salary

We pay our NEOs a base salary based on the experience, skills, knowledge and responsibilities required of each officer. We believe base salaries are an important element in our overall compensation program because base salaries provide a fixed element of compensation that reflects job responsibilities and value to us. In 2013, we paid base salaries of $400,000 to Mr. Thompson, $285,000 to Mr. Morris and $228,400 to Mr. Walsh. None of our NEOs is currently party to an employment agreement or other agreement or arrangement that provides for automatic or scheduled increases in base salary. Base salaries for our NEOs are determined by our full Board of Directors at its sole discretion, and no NEO has the right to automatic or scheduled increases in base salary.

Annual Incentive Bonuses

To date, our Board of Directors has not adopted a formal plan or set of formal guidelines with respect to annual incentive or bonus payments, and has rather relied on an annual assessment of the Company’s operating performance, including Adjusted EBITDA, as well as the performance of our executives during the preceding year to make annual incentive and bonus determinations. For 2013, the full Board of Directors determined to pay performance-based bonuses of $35,000 to Mr. Morris and $21,500 to Mr. Walsh. The performance-based bonuses, which are calculated as a percentage of base salary, are designed to motivate our employees to achieve annual goals based on our strategic, financial, and operating performance objectives. In connection with our efforts to formalize our compensation practices, our Board of Directors intends to adopt an annual incentive plan to which our NEOs will be eligible to participate. Our Board of Directors may retain the discretion to pay any amounts due under such incentive plan in cash or equity or a combination of both.

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Long-Term Equity Compensation

Although we do not have a formal policy with respect to the grant of equity incentive awards to our executive officers, or any formal equity ownership guidelines applicable to them, we believe that equity grants provide our executives with a strong link to our long-term performance, create an ownership culture and help to align the interests of our executives and our stockholders. In addition, we believe that equity grants with a time-based vesting feature promote executive retention because this feature incents our executive officers to remain in our employment during the vesting period. Accordingly, our Board of Directors periodically reviews the equity incentive compensation of our NEOs and from time to time may grant equity incentive awards to them in the form of stock options. In 2013, we did not grant any of our NEOs options to purchase shares of our common stock. In connection with this offering, we intend to adopt a new equity incentive plan in 2014, our 2014 Omnibus Incentive Plan (the “2014 Plan”), and we expect that all awards following the offering will be made under the 2014 Plan. For additional detail regarding the 2014 Plan, please see the “Stock Options and Other Compensation Plans” section below.

Other Supplemental Benefits

Our NEOs are eligible for the following benefits on a similar basis as other eligible employees:

• health, dental and vision insurance;

• vacation, personal holidays and sick days;

• life insurance and supplemental life insurance; and

• short-term and long-term disability.

401(k) Retirement Plan

Additionally, we maintain a 401(k) retirement savings plan (the “401(k) Plan”) that is intended to be a tax-qualified defined contribution plan under Section 401(k) of the Internal Revenue Code. In general, all of our employees are eligible to participate, beginning on the first day of the month following commencement of their employment. The 401(k) Plan includes a salary deferral arrangement pursuant to which participants may elect to reduce his or her current compensation by up to the statutorily prescribed limit, equal to $17,500 in 2014, and have the amount of the reduction contributed to his or her 401(k) Plan. Currently, we match contributions made by participants in the 401(k) Plan up to 4% of the employee’s annual eligible earnings. We believe that providing a vehicle for tax-deferred retirement savings through our 401(k) Plan, and making matching contributions, adds to the overall desirability of our executive compensation package and further incentivizes our employees, including our NEOs, in accordance with our compensation policies.

We do not maintain any pension plans or non-qualified deferred compensation plans for the benefit of our employees or other service providers.

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Summary Compensation Table

The following table sets forth information regarding compensation awarded to, earned by or paid to our NEOs during 2013.

Name and principal position	Year		Salary ($)(1)		Option Awards ($)(2)		Non-Equity Incentive Plan Compensation ($)(3)		All Other Compensation ($)(4)		Total ($)
Richard Thompson(5) Chief Executive Officer		2013		400,000		—		—		—		400,000
Scott Morris Chief Marketing Officer		2013		282,692		—		35,000		8,873		326,565
Cathal Walsh Senior Vice President		2013		227,108		—		21,500		10,163		258,771

(1) Salaries for fiscal 2013 include amounts deferred under the Company’s 401(k) plan.

(2) In 2013, we did not grant any of our NEOs options to purchase shares of our common stock.

(3) The amounts reported in the “Non-Equity Incentive Plan Compensation” column represent awards to our NEOs under our annual cash bonus program.

(4) The compensation included in the “All Other Compensation” column consists of premiums we paid with respect to each of our NEOs for (a) medical, dental and vision insurance, (b) personal accident insurance, (c) life insurance, (d) long-term disability insurance, (e) short-term disability insurance, and fees related to an education assistance program.

(5) Mr. Thompson also serves as a member of our Board of Directors but does not receive any additional compensation for his service as a director.

Outstanding Option Awards at December 31, 2013

The following table sets forth information regarding outstanding stock options held by our NEOs as of December 31, 2013:

Name	Number of Securities Underlying Unexercised Options Exercisable(1)		Number of Securities Underlying Unexercised Options Exercisable(2)		Option Exercise Price (Per Share)		Option Expiration Date
Richard Thompson		360,095		937,354	$	5.25		12/31/2020
Scott Morris		21,675		139,665		5.25		12/31/2020
		30,172		—		4.64		9/30/2016
Cathal Walsh		11,100		82,343		5.25		12/31/2020
		30,172		—	$	4.64		9/30/2016

(1) The unvested time based shares vest annually in approximately equal amounts through 2014.

(2) The unvested performance shares vest annually based on targets.

Employment Agreements with Named Executive Officers

We have written employment agreements with Mr. Thompson, Mr. Morris and Mr. Walsh. Each of the employment agreements provides             .

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Potential Payments Upon Termination or Change in Control

Each NEO is entitled to twelve months’ salary upon termination without cause regardless of a change in control.

Stock Option and Other Compensation Plans

2006 Stock Incentive Plan

The 2006 Stock Incentive Plan (the “2006 Plan”) was adopted by our Board of Directors and approved by our stockholders in October 2006. The 2006 Plan provided for the grant of incentive stock options, nonstatutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights and other stock-based awards to our employees, officers, directors, consultants and advisors. As of                     , 2014, there were options to purchase                      shares of our common stock outstanding under the 2006 Plan, at a weighted average exercise price of $          per share, and options to purchase             shares of our common stock had been exercised. The 2006 Plan was terminated in December 2010 and no awards have been granted under the 2006 Plan since such termination, however, any award outstanding under the 2006 Plan at the time of the termination will remain in effect until such award is exercised or has expired in accordance with its terms.

2010 Stock Option Plan

The 2010 Stock Option Plan (the “2010 Plan”) was adopted by our Board of Directors and approved by our stockholders in December 2010. The 2010 Plan provided for the grant of incentive stock options and nonstatutory stock options to our employees, officers, directors, consultants and advisors. As of                     , 2014, there were options to purchase                      shares of our common stock outstanding under the 2010 Plan, at a weighted average exercise price of $          per share, and options to purchase                      shares of our common stock had been exercised. We do not expect to make further grants under the 2010 Plan following the offering, however, any award outstanding under the 2010 Plan at the time of the completion of the offering will remain in effect until such award is exercised or has expired in accordance with its terms.

2014 Omnibus Incentive Plan

In connection with this offering, we intend to adopt the 2014 Plan. The 2014 Plan will provide for grants of stock options, stock appreciation rights, restricted stock, other stock-based awards and other cash-based awards. Directors, officers and other employees of us and our subsidiaries, as well as others performing consulting or advisory services for us, will be eligible for grants under the 2014 Plan. The purpose of the 2014 Plan is to provide incentives that will attract, retain and motivate high performing officers, directors, employees and consultants by providing them with appropriate incentives and rewards either through a proprietary interest in our long-term success or compensation based on their performance in fulfilling their personal responsibilities. Set forth below is a summary of the material terms we expect the 2014 Plan to include. For further information about the 2014 Plan, please see the form of the 2014 Plan, which is attached as an exhibit to the registration statement, of which this prospectus is a part.

Administration.    The 2014 Plan will be administered by the Compensation Committee of our Board of Directors. The Compensation Committee will have the power to determine the form, amount and other terms and conditions of awards; clarify, construe or resolve any ambiguity in any provision of the 2014 Plan or any award agreement; amend the terms of outstanding awards; and adopt such rules, forms, instruments and guidelines for administering the 2014 Plan as it deems necessary or proper. The Compensation Committee will have authority to administer and interpret the 2014 Plan, to grant

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discretionary awards under the 2014 Plan, to determine the persons to whom awards will be granted, to determine the types of awards to be granted, to determine the terms and conditions of each award, to determine the number of shares of common stock to be covered by each award, to make all other determinations in connection with the 2014 Plan and the awards thereunder as the Compensation Committee deems necessary or desirable and to delegate authority under the 2014 Plan to our executive officers.

Available Shares.    The aggregate number of shares of common stock which may be issued or used for reference purposes under the 2014 Plan or with respect to which awards may be granted may not exceed             shares. The number of shares available for issuance under the 2014 Plan may be subject to adjustment in the event of a reorganization, stock split, merger or similar change in the corporate structure or the outstanding shares of common stock. In the event of any of these occurrences, we may make any adjustments we consider appropriate to, among other things, the number and kind of shares, options or other property available for issuance under the plan or covered by grants previously made under the plan. The shares available for issuance under the plan may be, in whole or in part, either authorized and unissued shares of our common stock or shares of common stock held in or acquired for our treasury. In general, if awards under the 2014 Plan are for any reason cancelled, or expire or terminate unexercised, the shares covered by such awards may again be available for the grant of awards under the 2014 Plan.

The maximum number of shares of our common stock with respect to which any stock option, stock appreciation right, shares of restricted stock or other stock-based awards that are subject to the attainment of specified performance goals and intended to satisfy Section 162(m) of the Internal Revenue Code and may be granted under the 2014 Plan during any fiscal year to any eligible individual will be shares (per type of award). The total number of shares of our common stock with respect to all awards that may be granted under the 2014 Plan during any fiscal year to any eligible individual will be             shares. There are no annual limits on the number of shares of our common stock with respect to an award of restricted stock that are not subject to the attainment of specified performance goals to eligible individuals. The maximum number of shares of our common stock subject to any performance award which may be granted under the 2014 Plan during any fiscal year to any eligible individual will be             shares. The maximum value of a cash payment made under a performance award which may be granted under the 2014 Plan during any fiscal year to any eligible individual will be $         . The aggregate grant date fair value (computed as of the date of grant in accordance with applicable financial accounting rules) of all types of awards granted under the Plan to any individual non-employee director in any fiscal year (excluding awards made pursuant to deferred compensation arrangements in lieu of all or a portion of cash retainers and any stock dividends payable in respect of outstanding awards) may not exceed $         .

Eligibility for Participation.    Members of our Board of Directors, as well as employees of, and consultants to, us or any of our subsidiaries and affiliates are eligible to receive awards under the 2014 Plan.

Award Agreement.    Awards granted under the 2014 Plan will be evidenced by award agreements, which need not be identical, that will provide additional terms, conditions, restrictions and/or limitations covering the grant of the award, including, without limitation, additional terms providing for the acceleration of exercisability or vesting of awards in the event of a change of control or conditions regarding the participant’s employment, as determined by the Compensation Committee.

Stock Options.    The Compensation Committee may grant nonqualified stock options to eligible individuals and incentive stock options only to eligible employees. The Compensation Committee will determine the number of shares of our common stock subject to each option, the term of each option, which may not exceed ten years, or five years in the case of an incentive stock option granted to a ten

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percent stockholder, the exercise price, the vesting schedule, if any, and the other material terms of each option. No incentive stock option or nonqualified stock option may have an exercise price less than the fair market value of a share of our common stock at the time of grant or, in the case of an incentive stock option granted to a ten percent stockholder, 110% of such share’s fair market value. Options will be exercisable at such time or times and subject to such terms and conditions as determined by the Compensation Committee at grant and the exercisability of such options may be accelerated by the Compensation Committee.

Stock Appreciation Rights.    The Compensation Committee may grant stock appreciation rights, which we refer to as SARs, either with a stock option, which may be exercised only at such times and to the extent the related option is exercisable, which we refer to as a Tandem SAR, or independent of a stock option, which we refer to as a Non-Tandem SAR. A SAR is a right to receive a payment in shares of our common stock or cash, as determined by the Compensation Committee, equal in value to the excess of the fair market value of one share of our common stock on the date of exercise over the exercise price per share established in connection with the grant of the SAR. The term of each SAR may not exceed ten years. The exercise price per share covered by a SAR will be the exercise price per share of the related option in the case of a Tandem SAR and will be the fair market value of our common stock on the date of grant in the case of a Non-Tandem SAR. The Compensation Committee may also grant limited SARs, either as Tandem SARs or Non-Tandem SARs, which may become exercisable only upon the occurrence of a change in control, as defined in the 2014 Plan, or such other event as the Compensation Committee may designate at the time of grant or thereafter.

Restricted Stock.    The Compensation Committee may award shares of restricted stock. Except as otherwise provided by the Compensation Committee upon the award of restricted stock, the recipient generally has the rights of a stockholder with respect to the shares, including the right to receive dividends, the right to vote the shares of restricted stock and, conditioned upon full vesting of shares of restricted stock, the right to tender such shares, subject to the conditions and restrictions generally applicable to restricted stock or specifically set forth in the recipient’s restricted stock agreement. The Compensation Committee may determine at the time of award that the payment of dividends, if any, will be deferred until the expiration of the applicable restriction period.

Recipients of restricted stock are required to enter into a restricted stock agreement with us that states the restrictions to which the shares are subject, which may include satisfaction of pre-established performance goals, and the criteria or date or dates on which such restrictions will lapse.

If the grant of restricted stock or the lapse of the relevant restrictions is based on the attainment of performance goals, the Compensation Committee will establish for each recipient the applicable performance goals, formulae or standards and the applicable vesting percentages with reference to the attainment of such goals or satisfaction of such formulae or standards while the outcome of the performance goals are substantially uncertain. Such performance goals may incorporate provisions for disregarding, or adjusting for, changes in accounting methods, corporate transactions, including, without limitation, dispositions and acquisitions, and other similar events or circumstances. Section 162(m) of the Internal Revenue Code requires that performance awards be based upon objective performance measures. The performance goals for performance-based restricted stock will be based on one or more of the objective criteria set forth on Exhibit A to the 2014 Plan and are discussed in general below.

Other Stock-Based Awards.    The Compensation Committee may, subject to limitations under applicable law, make a grant of such other stock-based awards, including, without limitation, performance units, dividend equivalent units, stock equivalent units, restricted stock and deferred stock units under the 2014 Plan that are payable in cash or denominated or payable in or valued by shares

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of our common stock or factors that influence the value of such shares. The Compensation Committee may determine the terms and conditions of any such other awards, which may include the achievement of certain minimum performance goals for purposes of compliance with Section 162(m) of the Internal Revenue Code and/or a minimum vesting period. The performance goals for performance-based other stock-based awards will be based on one or more of the objective criteria set forth on Exhibit A to the 2014 Plan and discussed in general below.

Other Cash-Based Awards.    The Compensation Committee may grant awards payable in cash. Cash-based awards will be in such form, and dependent on such conditions, as the Compensation Committee will determine, including, without limitation, being subject to the satisfaction of vesting conditions or awarded purely as a bonus and not subject to restrictions or conditions. If a cash-based award is subject to vesting conditions, the Compensation Committee may accelerate the vesting of such award in its discretion.

Performance Awards.    The Compensation Committee may grant a performance award to a participant payable upon the attainment of specific performance goals. The Compensation Committee may grant performance awards that are intended to qualify as performance-based compensation under Section 162(m) of the Internal Revenue Code as well as performance awards that are not intended to qualify as performance-based compensation under Section 162(m) of the Internal Revenue Code. If the performance award is payable in cash, it may be paid upon the attainment of the relevant performance goals either in cash or in shares of restricted stock, based on the then current fair market value of such shares, as determined by the Compensation Committee. Based on service, performance and/or other factors or criteria, the Compensation Committee may, at or after grant, accelerate the vesting of all or any part of any performance award.

Performance Goals.    The Compensation Committee may grant awards of restricted stock, performance awards, and other stock-based awards that are intended to qualify as performance-based compensation for purposes of Section 162(m) of the Internal Revenue Code. These awards may be granted, vest and be paid based on attainment of specified performance goals established by the committee. These performance goals may be based on the attainment of a certain target level of, or a specified increase or decrease in, one or more of the following measures selected by the committee: (1) earnings per share; (2) operating income; (3) gross income; (4) net income, before or after taxes; (5) cash flow; (6) gross profit; (7) gross profit return on investment; (8) gross margin return on investment; (9) gross margin; (10) operating margin; (11) working capital; (12) earnings before interest and taxes; (13) earnings before interest, tax, depreciation and amortization; (14) return on equity; (15) return on assets; (16) return on capital; (17) return on invested capital; (18) net revenues; (19) gross revenues; (20) revenue growth; (21) annual recurring revenues; (22) recurring revenues; (23) license revenues; (24) sales or market share; (25) total stockholder return; (26) economic value added; (27) specified objectives with regard to limiting the level of increase in all or a portion of our bank debt or other long-term or short-term public or private debt or other similar financial obligations, which may be calculated net of cash balances and other offsets and adjustments as may be established by the Compensation Committee; (28) the fair market value of a share of our common stock; (29) the growth in the value of an investment in our common stock assuming the reinvestment of dividends; or (30) reduction in operating expenses.

To the extent permitted by law, the Compensation Committee may also exclude the impact of an event or occurrence which the Compensation Committee determines should be appropriately excluded, such as (1) restructurings, discontinued operations, extraordinary items and other unusual or non-recurring charges; (2) an event either not directly related to our operations or not within the reasonable control of management; or (3) a change in accounting standards required by generally accepted accounting principles.

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Performance goals may also be based on an individual participant’s performance goals, as determined by the Compensation Committee.

In addition, all performance goals may be based upon the attainment of specified levels of our performance, or the performance of a subsidiary, division or other operational unit, under one or more of the measures described above relative to the performance of other corporations. The Compensation Committee may designate additional business criteria on which the performance goals may be based or adjust, modify or amend those criteria.

Change in Control.    In connection with a change in control, as defined in the 2014 Plan, the Compensation Committee may accelerate vesting of outstanding awards under the 2014 Plan. In addition, such awards may be, in the discretion of the committee, (1) assumed and continued or substituted in accordance with applicable law; (2) purchased by us for an amount equal to the excess of the price of a share of our common stock paid in a change in control over the exercise price of the awards; or (3) cancelled if the price of a share of our common stock paid in a change in control is less than the exercise price of the award. The Compensation Committee may also provide for accelerated vesting or lapse of restrictions of an award at any time.

Stockholder Rights.    Except as otherwise provided in the applicable award agreement, and with respect to an award of restricted stock, a participant has no rights as a stockholder with respect to shares of our common stock covered by any award until the participant becomes the record holder of such shares.

Amendment and Termination.    Notwithstanding any other provision of the 2014 Plan, our Board of Directors may at any time amend any or all of the provisions of the 2014 Plan, or suspend or terminate it entirely, retroactively or otherwise, subject to stockholder approval in certain instances; provided, however, that, unless otherwise required by law or specifically provided in the 2014 Plan, the rights of a participant with respect to awards granted prior to such amendment, suspension or termination may not be adversely affected without the consent of such participant.

Transferability.    Awards granted under the 2014 Plan generally are nontransferable, other than by will or the laws of descent and distribution, except that the committee may provide for the transferability of nonqualified stock options at the time of grant or thereafter to certain family members.

Recoupment of Awards.    The 2014 Plan will provide that awards granted under the 2014 Plan are subject to any recoupment policy that we may have in place or any obligation that we may have regarding the clawback of “incentive-based compensation” under the Securities Exchange Act of 1934 or under any applicable rules and regulations promulgated by the Securities and Exchange Commission.

Effective Date; Term.    The 2014 Plan will be adopted by the Board of Directors on                     , 2014 and proposed to stockholders             . No award will be granted under the 2014 Plan on or after                     , 2024. Any award outstanding under the 2014 Plan at the time of termination will remain in effect until such award is exercised or has expired in accordance with its terms.

Limitations on Liability and Indemnification

Our Certificate of Incorporation, which will become effective upon the closing of this offering, limits the personal liability of directors for breach of fiduciary duty to the maximum extent permitted by the Delaware General Corporation Law and provides that no director will have personal liability to us or to our stockholders for monetary damages for breach of fiduciary duty or other duty as a director. However, these provisions do not eliminate or limit the liability of any of our directors:

• for any breach of the director’s duty of loyalty to us or our stockholders;

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• for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;

• for voting for or assenting to unlawful payments of dividends, stock repurchases or other distributions; or

• for any transaction from which the director derived an improper personal benefit.

Any amendment to or repeal of these provisions will not eliminate or reduce the effect of these provisions in respect of any act, omission or claim that occurred or arose prior to such amendment or repeal. If the Delaware General Corporation Law is amended to provide for further limitations on the personal liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent permitted by the Delaware General Corporation Law.

In addition, our Certificate of Incorporation, which will become effective upon the closing of this offering, provides that we must indemnify our directors and officers and we must advance expenses, including attorneys’ fees, to our directors and officers in connection with legal proceedings, subject to very limited exceptions.

We maintain a general liability insurance policy that covers certain liabilities of our directors and officers arising out of claims based on acts or omissions in their capacities as directors or officers. In addition, we have entered into indemnification agreements with our directors. These indemnification agreements may require us, among other things, to indemnify each such director for some expenses, including attorneys’ fees, judgments, fines and settlement amounts incurred by him in any action or proceeding arising out of his service as one of our directors.

Certain of our non-employee directors may, through their relationships with their employers, be insured and/or indemnified against certain liabilities incurred in their capacity as members of our Board of Directors.

Rule 10b5-1 Sales Plans

Our directors and executive officers may adopt written plans, known as Rule 10b5-1 plans, in which they will contract with a broker to buy or sell shares of our common stock on a periodic basis. Under a Rule 10b5-1 plan, a broker executes trades pursuant to parameters established by the director or officer when entering into the plan, without further direction from the director or officer. It also is possible that the director or officer could amend or terminate the plan when not in possession of material, nonpublic information. In addition, our directors and executive officers may buy or sell additional shares outside of a Rule 10b5-1 plan when they are not in possession of material, nonpublic information.

Director Compensation

In the year ended December 31, 2013, none of our directors received compensation for their services on our Board of Directors. Following this offering, our non-employee directors will be compensated for their services on our Board of Directors as follows:

• each non-employee director will receive an annual fee of $         ; and

• each non-employee director who serves as chairman of a committee of our Board of Directors will receive additional compensation as follows:

• chairman of the audit committee–an additional annual fee of $         ;

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• chairman of the compensation committee–an additional annual fee of $         ; and

• chairman of the nominating and corporate governance committee–an additional annual fee of $        .

Each annual fee will be payable in arrears in four equal quarterly installments on the last day of each quarter, provided that the amount of each payment will be prorated for any portion of a quarter that a director is not serving on our board and no fee will be payable in respect of any period prior to the effective date of the registration statement of which this prospectus is a part.

Each member of our Board of Directors will also continue to be entitled to reimbursement for reasonable travel and other expenses incurred in connection with attending meetings of the Board of Directors and any committee of the Board of Directors on which he or she serves.

Prior to this offering, we have not paid cash retainers or provided other forms of compensation such as non-equity awards, equity awards or perquisites, with respect to service on our Board of Directors. We have historically reimbursed our directors for reasonable travel and other expenses incurred in connection with attending meetings of the Board of Directors or committees of the Board of Directors.

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PRINCIPAL AND SELLING STOCKHOLDERS

The following table shows information about the beneficial ownership of our common stock, as of                     , 2014, by:

• each person known by us to beneficially own 5% or more of our outstanding common stock;

• each selling stockholder;

• each of our directors and executive officers; and

• all of our directors and executive officers as a group.

For further information regarding material transactions between us and certain of our stockholders, see “Certain Relationships and Related Party Transactions.”

The numbers listed below are based on             shares of our common stock outstanding as of                     , 2014, after giving effect to the Stock Split and the Preferred Stock Conversion.

Upon the completion of this offering, MidOcean will own approximately     % of our common stock, or     % if the underwriters’ option to purchase additional shares of our common stock is exercised in full.

Unless otherwise indicated, the address of each individual listed in this table is c/o Freshpet, Inc., 400 Plaza Drive, 1^st Floor, Secaucus, New Jersey 07094.

Name and Address of Beneficial Owner(1)	Common stock owned before the offering		Number of shares being offered	Common stock owned after the offering (no option exercise)		Common stock owned after the offering (full option exercise)
	Number	Percentage		Number	Percentage	Number	Percentage
5% Stockholders and Other Selling Stockholders:
MidOcean(2)
Freshpet Investors LLC(3)
Tyson Foods, Inc.
Executive Officers and Directors:
Charles A. Norris(4)
J. David Basto
Jonathan S. Marlow
Richard Thompson
Richard Kassar
Scott Morris
Cathal Walsh
Michael Hieger
Stephen Macchiaverna
Thomas Farina
Kathryn Winstanley
Executive Officers and Directors as a Group (    persons)

* Less than 1%

(1) A “beneficial owner” of a security is determined in accordance with Rule 13d-3 under the Exchange Act and generally means any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise, has or shares:

• voting power which includes the power to vote, or to direct the voting of, such security; and/or

• investment power which includes the power to dispose, or to direct the disposition of, such security.

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Unless otherwise indicated, each person named in the table above has sole voting and investment power, or shares voting and investment power with his spouse (as applicable), with respect to all shares of stock listed as owned by that person. Shares issuable upon the exercise of options exercisable on                 , 2014 or within 60 days thereafter are considered outstanding and to be beneficially owned by the person holding such options for the purpose of computing such person’s percentage beneficial ownership, but are not deemed outstanding for the purposes of computing the percentage of beneficial ownership of any other person. The address of our executive officers is 400 Plaza Drive, 1^st Floor, Secaucus, New Jersey 07094.

(2) Includes                  shares of common stock held by MidOcean Partners III, L.P.,              shares of common stock held by MidOcean Partners III-A, L.P. and                  shares of common stock held by MidOcean Partners III-D, L.P. (collectively, the “MidOcean Entities”). MidOcean Associates, SPC (“Associates”) is the General Partner of each of the MidOcean Entities. MidOcean US Advisor, L.P. (“US Advisor”) provides investment advisory services to each of the MidOcean Entities and Associates. J. Edward Virtue indirectly controls the shares of common stock held by the MidOcean Entities. Accordingly, Associates, US Advisor and Mr. Virtue may be deemed to have beneficial ownership of the shares of common stock held by the MidOcean Entities, although each of Associates, US Advisor and Mr. Virtue disclaims beneficial ownership of the shares owned of record by any other person or entity except to the extent of their pecuniary interest therein. The address for each of the MidOcean Entities, Associates, US Advisor and Mr. Virtue is 320 Park Avenue, 16th Floor, New York, New York 10022.

(3) Charles A. Norris and Kayne Anderson Capital Advisors L.P. are the managing members of Freshpet Investors LLC and share voting and investment power over the shares of common stock held by Freshpet Investors LLC. Richard Kayne is the managing partner of Kayne Anderson Capital Advisors L.P. Mr. Norris, Mr. Kayne and Kayne Anderson Capital Advisors L.P. disclaim beneficial ownership of all of the shares of common stock held or controlled by Freshpet Investors LLC except to the extent of their pecuniary interest therein.

(4) Includes                  shares of common stock held by Mr. Norris directly and                 shares of common stock held by Freshpet Investors LLC (See footnote 3). Mr. Norris disclaims beneficial ownership of all of the shares of common stock held or controlled by Freshpet Investors LLC except to the extent of his pecuniary interest therein.

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Registration Rights Agreement

Pursuant to the terms of a Registration Rights Agreement among ourselves,                     and                     , certain holders of our stock are entitled to demand and piggyback rights in relation to their holdings of our shares. The stockholders who are a party to the Registration Rights Agreement will hold an aggregate of             shares, or     %, of our equity interests upon completion of this offering, assuming the underwriters option to purchase additional shares of our common stock is not exercised.

Demand Registrations

Under the Registration Rights Agreement, MidOcean is able to require us to use our best efforts to file a registration statement under the Securities Act (“Demand Registration”), and we are required to notify holders of such registrable securities in the event of such request (a “Demand Registration Request”). MidOcean can issue unlimited Demand Registration Requests. All eligible holders will be entitled to participate in any Demand Registration upon proper notice to us. We have certain limited rights to delay or postpone such registration.

Piggyback Registrations

Under the Registration Rights Agreement, if at any time we propose or are required to register any of our equity securities under the Securities Act (other than a Demand Registration, a merger or acquisition or pursuant to an employee benefit or dividend reinvestment plan), we will be required to notify each eligible holder of its right to participate in such registration (a “Piggyback Registration”). We have the right to terminate or postpone any registration statement in which eligible holders have elected to exercise Piggyback Registration rights.

Expenses of Registration

We are required to bear the registration expenses (other than underwriting discounts) incident to any registration in accordance with the Registration Rights Agreement, including the reasonable fees of counsel chosen by MidOcean (if MidOcean holds any registrable securities included in the registration) or by the holders of a majority of the registrable securities included in the registration.

Indemnification

Under the Registration Rights Agreement, we must, subject to certain limitations, indemnify each holder of our registrable securities and its officers, managers, managing members and directors, and each person controlling such holder against all losses, claims, actions, damages, liabilities and expenses in certain circumstances and to pay any expenses reasonably incurred in connection with investigating and defending such losses, claims, actions, damages, liabilities and expenses, except insofar as the same are caused by or contained in any information furnished in writing to us by such holder expressly for use therein.

Stockholders Agreement

We expect to enter into a stockholders agreement (the “Stockholders Agreement”) with MidOcean, Freshpet Investors LLC and certain of our stockholders, which will be effective upon                     . The Stockholders Agreement provides that                     .

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Indemnification Agreements

We expect to enter into indemnification agreements with each of our directors and executive officers. Each indemnification agreement will provide that, subject to limited exceptions, and among other things, we will indemnify the director or executive officer to the fullest extent permitted by law for claims arising in his or her capacity as our director or officer.

Guarantee Agreement

In connection with the $62.5 Million Revolver, we entered into a Fee and Reimbursement Agreement with MidOcean, Freshpet Investors LLC, an entity related to Charles A. Norris, our Chairman of the Board of Directors, Richard Thompson, our Chief Executive Officer, and Richard Kassar, our Chief Financial Officer, each a guarantor of a portion of the $62.5 Million Revolver. MidOcean, an entity related to Charles A. Norris, Richard Thompson and Richard Kassar guarantee $32.9 million, $4.3 million, $0.3 million and $0.7 million, respectively. The agreement stipulates that we will pay each guarantor a contingent fee equal to 10% per annum of the amount that each guarantor has committed to guarantee. Payments are to be made in the form of newly issued shares of Series C Preferred Stock at the price of $5.25 per share. The fee accrues only from and after the date that the guarantor enters into the guarantee, and if at any time any guarantor’s obligation is terminated in full or in part, the fee continues to accrue only with respect to the amount, if any, of such guarantor’s remaining commitment under the credit agreement governing the $62.5 Million Revolver. The fee is contingent in that it will become due and payable only if all principal and interest under the $62.5 Million Revolver has been repaid and a Change of Control has occurred. A Change of Control is defined as any sale, merger, consolidation, share exchange, business combination, equity issuance, or other transaction or series of related transactions, specifically excluding public offerings such as this offering, which result in the stockholders immediately prior to the transaction(s) owning collectively less than 50% of the voting control immediately following the transaction(s) or (ii) any sale, lease, exchange, transfer, or other disposition of substantially all of the assets, taken as a whole, in a single transaction or series of transactions, excluding sales in the ordinary course of business, sale/leaseback and corporate restructuring transactions. To date, no shares of Series C Preferred Stock have been issued in connection with the Fee and Reimbursement Agreement. As of June 30, 2014, MidOcean, an entity related to Mr. Norris, Mr. Thompson and Mr. Kassar had accrued 1,069,265, 137,606, 19,272 and 21,794 shares of unissued Series C Preferred Stock, respectively. We plan to use a portion of the proceeds from this offering to repay the borrowings under the $62.5 Million Revolver, relieving us of future fees on the debt guarantee except for changes in fair market value.

The Stockholder Note

We issued $1.5 million of notes to certain stockholders of the Company. The Stockholder Note accrues interest compounded annually at a rate of 10%. The Stockholder Note and all accrued interest are due on December 23, 2020.            ,             , and              each hold $             million, $             million and $            , respectively of the Stockholder Note.

Tyson Agreement

Effective January 9, 2009, we entered into a distribution agreement with Tyson Foods, Inc. (“Tyson”), which is one of our stockholders. Pursuant to the distribution agreement, Tyson agreed to perform certain distribution and logistical services for us. Our agreement with Tyson expires on December 31, 2014. We are currently in negotiations to renew the distribution agreement. For the years ended December 31, 2012 and 2013, we paid $4.8 million and $6.1 million, respectively, for work performed by Tyson under the agreement.

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We also purchase, on an as needed basis, certain raw materials from Tyson. For the years ended December 31, 2012 and 2013, we paid $0.3 million and $0.5 million, respectively, to Tyson for raw materials provided to us.

Procedures for Approval of Related Party Transactions

We do not currently have a formal written policy or procedures for the review and approval of related party transactions. However, all related party transactions are currently reviewed and approved by a disinterested majority of our Board of Directors.

Our Board of Directors will adopt a written related person transaction policy, effective upon the closing of this offering, which sets forth the policies and procedures for the review and approval or ratification of related party transactions. This policy will be administrated by our Audit Committee. These policies will provide that, in determining whether or not to recommend the initial approval or ratification of a related party transaction, the relevant facts and circumstances available shall be considered, including, among other factors it deems appropriate, whether the interested transaction is on terms no less favorable than terms generally available to an unaffiliated third party under the same or similar circumstances and the extent of the related party’s interest in the transaction.

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DESCRIPTION OF CAPITAL STOCK

The following summary of certain provisions of our capital stock does not purport to be complete and is subject to our Certificate of Incorporation, our Bylaws and the provisions of applicable law. Copies of our Certificate of Incorporation and Bylaws are filed as exhibits to the registration statement, of which this prospectus is a part.

Authorized Capitalization

General

Upon the closing of this offering, the total amount of our authorized capital stock will consist of             shares of common stock, par value $0.001 per share, and             shares of undesignated preferred stock. As of June 30, 2014, after giving effect to the Stock Split and the Preferred Stock Conversion, we had             shares of common stock, par value $0.001 per share, outstanding.

After giving effect to this offering, we will have             shares of common stock and no shares of preferred stock outstanding, assuming the underwriters’ option to purchase additional shares is not exercised. The following summary describes all material provisions of our capital stock. We urge you to read our Certificate of Incorporation and our Bylaws, which are included as exhibits to the registration statement of which this prospectus forms a part.

Common Stock

As of June 30, 2014, there were 94 stockholders of record of our common stock. Our common stock is not entitled to preemptive or other similar subscription rights to purchase any of our securities. Our common stock is neither convertible nor redeemable. Unless our Board of Directors determines otherwise, we will issue all of our capital stock in uncertificated form.

Preferred Stock

Our Board of Directors has the authority to issue shares of preferred stock from time to time on terms it may determine, to divide shares of preferred stock into one or more series and to fix the designations, preferences, privileges, and restrictions of preferred stock, including dividend rights, conversion rights, voting rights, terms of redemption, liquidation preference, sinking fund terms, and the number of shares constituting any series or the designation of any series to the fullest extent permitted by the General Corporation Law of the State of Delaware (the “DGCL”). The issuance of our preferred stock could have the effect of decreasing the trading price of our common stock, restricting dividends on our capital stock, diluting the voting power of our common stock, impairing the liquidation rights of our capital stock, or delaying or preventing a change in control of our Company.

Voting Rights

Each holder of our common stock is entitled to one vote per share on each matter submitted to a vote of stockholders. Our Bylaws provide that the presence, in person or by proxy, of holders of shares representing a majority of the outstanding shares of capital stock entitled to vote at a stockholders’ meeting shall constitute a quorum. When a quorum is present, the affirmative vote of a majority of the votes cast is required to take action, unless otherwise specified by law or our Certificate of Incorporation, and except for the election of directors, which is determined by a plurality vote. There are no cumulative voting rights.

Dividend Rights

Each holder of shares of our capital stock will be entitled to receive such dividends and other distributions in cash, stock or property as may be declared by our Board of Directors from time to time

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out of our assets or funds legally available for dividends or other distributions. See “Dividend Policy.” These rights are subject to the preferential rights of the holders of our preferred stock, if any, and any contractual limitations on our ability to declare and pay dividends.

Other Rights

Each holder of common stock is subject to, and may be adversely affected by, the rights of the holders of any series of preferred stock that we may designate and issue in the future. This offering is not subject to pre-emptive rights.

Liquidation Rights

If our company is involved in a consolidation, merger, recapitalization, reorganization, voluntary or involuntary liquidation, dissolution or winding up of our affairs, or similar event, each holder of common stock will participate pro rata in all assets remaining after payment of liabilities, subject to prior distribution rights of preferred stock, if any, then outstanding.

Anti-takeover Effects of our Certificate of Incorporation and Bylaws

Our Certificate of Incorporation and our Bylaws will contain provisions that may delay, defer or discourage another party from acquiring control of us. We expect that these provisions, which are summarized below, will discourage coercive takeover practices or inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with the Board of Directors, which we believe may result in an improvement of the terms of any such acquisition in favor of our stockholders. However, they also give the Board of Directors the power to discourage acquisitions that some stockholders may favor.

Action by Written Consent, Special Meeting of Stockholders

and Advance Notice Requirements for Stockholder Proposals

Our Certificate of Incorporation will provide that stockholder action can be taken only at an annual or special meeting of stockholders and cannot be taken by written consent in lieu of a meeting. Our Certificate of Incorporation and Bylaws will also provide that, except as otherwise required by law, special meetings of the stockholders can be called only pursuant to a resolution adopted by a majority of the total number of directors that we would have if there were no vacancies. Except as described above, stockholders will not be permitted to call a special meeting or to require the Board of Directors to call a special meeting.

In addition, our Bylaws will require advance notice procedures for stockholder proposals to be brought before an annual meeting of the stockholders, including the nomination of directors. Stockholders at an annual meeting may only consider the proposals specified in the notice of meeting or brought before the meeting by or at the direction of the Board of Directors, or by a stockholder of record on the record date for the meeting, who is entitled to vote at the meeting and who has delivered a timely written notice in proper form to our secretary, of the stockholder’s intention to bring such business before the meeting.

These provisions could have the effect of delaying until the next stockholder meeting any stockholder actions, even if they are favored by the holders of a majority of our outstanding voting securities.

Classified Board

Our Certificate of Incorporation will provide that our Board of Directors will be divided into three classes of directors, with the classes as nearly equal in number as possible. As a result, approximately one-third of our Board of Directors will be elected each year. The classification of directors will have the effect of making it more difficult for stockholders to change the composition of our board.

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Removal of Directors

Our Certificate of Incorporation will provide that directors may only be removed from office only for cause and only upon the affirmative vote of at least 75% of the voting power of our outstanding shares of common stock.

Amendment to Certificate of Incorporation and Bylaws

The DGCL provides generally that the affirmative vote of a majority of the outstanding stock entitled to vote on amendments to a corporation’s certificate of incorporation or bylaws is required to approve such amendment, unless a corporation’s certificate of incorporation or bylaws, as the case may be, requires a greater percentage. Our Bylaws may be further amended, altered, changed or repealed by a majority vote of our Board of Directors, provided that, in addition to any other vote otherwise required by law, the affirmative vote of at least 75% of the voting power of our outstanding shares of common stock will be required to amend, alter, change or repeal our Bylaws. Additionally, the affirmative vote of at least 75% of the voting power of the outstanding shares of capital stock entitled to vote on the adoption, alteration, amendment or repeal of our Certificate of Incorporation, voting as a single class, will be required to amend or repeal or to adopt any provision inconsistent with specified provisions of our Certificate of Incorporation. This requirement of a supermajority vote to approve amendments to our Certificate of Incorporation and Bylaws could enable a minority of our stockholders to exercise veto power over any such amendments.

Delaware Anti-Takeover Statute

Section 203 of the DGCL provides that if a person acquires 15% or more of the voting stock of a Delaware corporation, such person becomes an “interested stockholder” and may not engage in certain “business combinations” with the corporation for a period of three years from the time such person acquired 15% or more of the corporation’s voting stock, unless: (1) the Board of Directors approves the acquisition of stock or the merger transaction before the time that the person becomes an interested stockholder, (2) the interested stockholder owns at least 85% of the outstanding voting stock of the corporation at the time the merger transaction commences (excluding voting stock owned by directors who are also officers and certain employee stock plans), or (3) the merger transaction is approved by the Board of Directors and by the affirmative vote at a meeting, not by written consent, of stockholders of 2/3 of the holders of the outstanding voting stock which is not owned by the interested stockholder. A Delaware corporation may elect in its certificate of incorporation or bylaws not to be governed by this particular Delaware law.

Under our Certificate of Incorporation, we will opt out of Section 203 of the DGCL and will therefore not be subject to Section 203.

Corporate Opportunity

Our Certificate of Incorporation will provide that we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any business opportunity that may from time to time be presented to MidOcean or any of its officers, directors, agents, stockholders, members, partners, affiliates and subsidiaries (other than us and our subsidiaries) and that may be a business opportunity for MidOcean, even if the opportunity is one that we might reasonably have pursued or had the ability or desire to pursue if granted the opportunity to do so. No such person will be liable to us for breach of any fiduciary or other duty, as a director or officer or otherwise, by reason of the fact that such person, acting in good faith, pursues or acquires any such business opportunity, directs any such business

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opportunity to another person or fails to present any such business opportunity, or information regarding any such business opportunity, to us unless, in the case of any such person who is our director or officer, any such business opportunity is expressly offered to such director or officer solely in his or her capacity as our director or officer. Neither MidOcean, nor any of its representatives has any duty to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us or any of our subsidiaries.

Limitations on Liability and Indemnification of Officers and Directors

Our Certificate of Incorporation will limit the liability of our directors to the fullest extent permitted by the DGCL, and our Bylaws will provide that we will indemnify them to the fullest extent permitted by such law. We expect to enter into indemnification agreements with our current directors and executive officers prior to the completion of this offering and expect to enter into a similar agreement with any new directors or executive officers.

Exclusive Jurisdiction of Certain Actions

Our Certificate of Incorporation will require, to the fullest extent permitted by law, that derivative actions brought in the name of the Company, actions against directors, officers and employees for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel. Although we believe this provision benefits the Company by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging lawsuits against our directors and officers.

Payment of Legal Fees in Certain Proceedings

Our Certificate of Incorporation will provide, to the fullest extent permitted by law, in the event that any person or entity (the “Claimant”) (x) initiates or asserts (1) any derivative action or proceeding brought on behalf of the Company, (2) any claim of breach of a fiduciary duty owed by any director, officer, employee or agent of the Company to the Company or its stockholders, (3) any action against the Company or any of its directors, officers, employees or agents arising pursuant to any provision of the General Corporation Law of the State of Delaware, our Certificate of Incorporation or our Bylaws, or (4) any action asserting a claim governed by the internal affairs doctrine (each of the foregoing, a “Claim”), or joins any such Claim as a named party, and (y) does not thereby obtain a judgment on the merits that substantially achieves the full remedy or relief sought in the Claim, such Claimant shall be jointly and severally obligated to reimburse the Company for all fees, costs and expenses (including attorneys’ fees and the fees of experts) actually and reasonably incurred by the Company in defending such Claim.

Registration Rights

See “Certain Relationships and Related Party Transactions—Registration Rights Agreement.”

Transfer Agent and Registrar

The transfer agent and registrar for our common stock is                     .

Listing

We intend to apply to list our common stock on the                     under the symbol “                     .”

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SHARES ELIGIBLE FOR FUTURE SALE

Prior to this offering, there has been no public market for our common stock and a liquid trading market for our common stock may not develop or be sustained after this offering. Future sales of substantial amounts of our common stock in the public market, or the perception that such sales may occur, could adversely affect the prevailing market price of our common stock and impair our ability to raise equity capital in the future. No prediction can be made as to the effect, if any, future sales of shares, or the availability of shares for future sales, will have on the market price of our common stock prevailing from time to time. As described below, only a limited number of shares of our common stock will be available for sale in the public market for a period of several months after consummation of this offering due to contractual and legal restrictions on resale described below. Future sales of our common stock in the public market either before (to the extent permitted) or after restrictions lapse, or the perception that those sales may occur, could adversely affect the prevailing market price of our common stock at such time and our ability to raise equity capital at a time and price we deem appropriate.

Sale of Restricted Shares

Upon completion of this offering, we will have             shares of common stock outstanding assuming the underwriters’ option to purchase additional shares of common stock is not exercised. Of these shares of common stock, the             shares of common stock being sold in this offering, plus any shares sold upon exercise of the underwriters’ option to purchase additional shares, will be freely tradable without restriction under the Securities Act, except for any such shares which may be acquired by an “affiliate” of ours, as that term is defined in Rule 144, which shares will be subject to the volume limitations and other restrictions of Rule 144 described below. The remaining             shares of common stock held by our existing stockholders upon completion of this offering will be “restricted securities,” as that term is defined in Rule 144, and may be resold only after registration under the Securities Act or pursuant to an exemption from such registration, including, among others, the exemptions provided by Rule 144 and Rule 701 under the Securities Act, which rules are summarized below. These remaining shares of common stock held by our existing stockholders upon completion of this offering will be available for sale in the public market (after the expiration of the lock-up agreements described below) only if registered or if they qualify for an exemption from registration under Rule 144 or Rule 701 under the Securities Act, as described below.

In connection with this offering, we, the selling stockholders, our directors, our executive officers and holders of substantially all of our outstanding capital stock have agreed, subject to certain exceptions, not to dispose of or hedge any shares of our equity interests or securities convertible into or exchangeable for our equity interests during the period from the date of the lock-up agreement continuing through the date 180 days after the date of this prospectus, except with the prior written consent of Goldman, Sachs & Co. and Credit Suisse Securities (USA) LLC.

Following the lock-up periods set forth in the agreements described above, and assuming that the representatives of the underwriters do not release any parties from these agreements, all of the common stock that are restricted securities or are held by our affiliates as of the date of this prospectus will be eligible for sale in the public market in compliance with Rule 144 under the Securities Act.

Rule 144

In general, under Rule 144, as currently in effect, persons who are not one of our affiliates at any time during the three months preceding a sale may sell shares of our common stock beneficially held

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upon the earlier of (1) the expiration of a six-month holding period, if we have been subject to the reporting requirements of the Exchange Act and have filed all required reports for at least 90 days prior to the date of the sale, or (2) a one-year holding period.

At the expiration of the six-month holding period, a person who was not one of our affiliates at any time during the three months preceding a sale would be entitled to sell an unlimited number of shares of our common stock provided current public information about us is available, and a person who was one of our affiliates at any time during the three months preceding a sale would be entitled to sell within any three-month period a number of shares of common stock that does not exceed the greater of either of the following:

• 1% of the number of shares of our common stock then outstanding, which will equal approximately             shares immediately after this offering, based on the number of shares of our common stock outstanding as of                     , 2014; or

• the average weekly trading volume of our common stock on the                     during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.

At the expiration of the one-year holding period, a person who was not one of our affiliates at any time during the three months preceding a sale would be entitled to sell an unlimited number of shares of our common stock without restriction. A person who was one of our affiliates at any time during the three months preceding a sale would remain subject to the volume restrictions described above.

Sales under Rule 144 by our affiliates are also subject to manner of sale provisions, notice requirements and to the availability of current public information about us. Notwithstanding the availability of Rule 144, the holders of substantially all of our” restricted securities” have entered into lock-up agreements as referenced above and their “restricted securities” will become eligible for sale (subject to the above limitations under Rule 144) upon the expiration of the restrictions set forth in those agreements.

Rule 701

In general, and subject to expiration of the applicable lock-up restrictions, under Rule 701 promulgated under the Securities Act, any of our employees, directors or officers who purchased shares from us in connection with a qualified compensatory stock or option plan or other written agreement before the effective date of this offering, or who purchased shares from us after that date upon the exercise of options granted before that date (subject to the lock-up agreements referred to below, as applicable), are eligible to resell such shares in reliance upon Rule 144 beginning 90 days after the date of this prospectus. If such person is not an affiliate, the sale may be made under Rule 144 without compliance with the holding periods of Rule 144 and subject only to the manner-of-sale restrictions of Rule 144. If such a person is an affiliate, the sale may be made under Rule 144 without compliance with its one-year minimum holding period, but subject to the other Rule 144 restrictions.

Stock Plans

We intend to file one or more registration statements on Form S-8 under the Securities Act to register shares of our common stock issued or reserved for issuance under our existing option plan and the new equity incentive plan we intend to adopt in connection with this offering. The first such registration statement is expected to be filed soon after the date of this prospectus and will automatically become effective upon filing with the SEC. Accordingly, shares registered under such registration statement will be available for sale in the open market following the effective date, unless such shares are subject to vesting restrictions with us, Rule 144 restrictions applicable to our affiliates or the lock-up restrictions described below.

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Lock-Up Agreements

We, the selling stockholders, our executive officers, directors and holders of all or substantially all our outstanding capital stock have agreed, subject to certain exceptions, not to directly or indirectly:

• sell, offer, contract or grant any option to sell (including any short sale), pledge, transfer, establish an open “put equivalent position” within the meaning of Rule 16a-l(h) under the Exchange Act; or

• otherwise dispose of any shares of common stock, options or warrants to acquire shares of common stock, or securities exchangeable or exercisable for or convertible into shares of common stock currently or hereafter owned either of record or beneficially; or

• publicly announce an intention to do any of the foregoing for a period of 180 days after the date of this prospectus without the prior written consent of Goldman, Sachs & Co. and Credit Suisse Securities (USA) LLC.

This restriction terminates after the close of trading of the common stock on and including the 180^th day after the date of this prospectus. For additional information, see “Underwriting.”

Registration Rights

Upon completion of this offering, the holders of an aggregate of                     shares of our common stock, or their transferees, will be entitled to certain rights with respect to the registration of their shares under the Securities Act. Except for shares purchased by affiliates, registration of their shares under the Securities Act would result in these shares becoming freely tradable without restriction under the Securities Act immediately upon effectiveness of the registration, subject to the expiration of the lock-up period, with respect to certain of the shares, described under “Underwriting” in this prospectus, and to the extent such shares have been released from any repurchase option that we may hold. See “Certain Relationships and Related Party Transactions—Registration Rights Agreement” for more information.

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MATERIAL U.S. FEDERAL INCOME AND ESTATE TAX CONSIDERATIONS FOR

NON-U.S. HOLDERS

Overview

The following is a summary of material U.S. federal income and estate tax consequences to non-U.S. holders, as defined below, of the ownership and disposition of shares of our common stock as of the date of this prospectus. This summary deals only with shares of common stock purchased in this offering that are held as capital assets (generally, property held for investment) by a non-U.S. holder.

For purposes of this discussion, a “non-U.S. holder” means a beneficial owner of shares of our common stock that, for U.S. federal income tax purposes, is not any of the following:

• an individual who is a citizen or resident of the United States;

• a corporation (or any other entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;

• any entity or arrangement treated as a partnership for U.S. federal income tax purposes;

• an estate the income of which is subject to U.S. federal income taxation regardless of its source; or

• a trust if it (1) is subject to the primary supervision of a court within the United States and one or more United States persons have the authority to control all substantial decisions of the trust or (2) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a United States person for U.S. federal income tax purposes.

If any entity or arrangement treated as a partnership for U.S. federal income tax purposes holds shares of our common stock, the tax treatment of a partner in such partnership generally will depend upon the status of the partner and the activities of the partner and the partnership. If you are a partner of a partnership considering an investment in shares of our common stock, you should consult your own tax advisors.

This summary is based upon provisions of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), applicable U.S. Treasury regulations, rulings and other administrative pronouncements and judicial decisions, all as in effect as of the date hereof. Those authorities are subject to different interpretations and may be changed at any time, perhaps retroactively, so as to result in U.S. federal income and estate tax consequences different from those summarized below. We have not sought and do not expect to seek any rulings from the U.S. Internal Revenue Service (the “IRS”) regarding the matters discussed below. There can be no assurance that the IRS will not take positions concerning the tax consequences of the ownership or disposition of shares of our common stock that differ from those discussed below. We cannot assure you that a change in law will not alter significantly the tax consequences described in this summary.

This summary does not address all aspects of U.S. federal income and estate taxes and does not deal with the foreign, state, local, alternative minimum tax, any aspects of the unearned income Medicare contribution tax pursuant to the Health Care and Education Reconciliation Act of 2010 or other tax considerations that may be relevant to non-U.S. holders in light of their particular circumstances. In addition, this summary does not describe the U.S. federal income tax consequences applicable to you if you are subject to special treatment under U.S. federal income tax laws (including if you are a U.S. expatriate or U.S. expatriated entity, a financial institution, an insurance company, a tax-exempt organization, a trader, broker or dealer in securities or currencies, a “controlled foreign corporation,” a “passive foreign investment company,” an entity treated as a partnership or other pass-through entity for U.S. federal income tax purposes (or an investor in such a pass-through entity),

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a person who acquired shares of our common stock as compensation or otherwise in connection with the performance of services, or a person who has acquired shares of our common stock as part of a straddle, hedge, conversion transaction or other integrated investment).

This summary is for general information only and is not intended to constitute a complete description of all U.S. federal income and estate tax consequences for non-U.S. holders relating to the ownership and disposition of our common stock. If you are considering the purchase of shares of our common stock, you should consult your own tax advisors concerning the particular U.S. federal income and estate tax consequences to you of the ownership and disposition of shares of our common stock, as well as the consequences to you arising under other U.S. federal tax laws and the laws of any other applicable taxing jurisdiction in light of your particular circumstances.

Dividends

As discussed under “Dividend Policy” above, we do not currently expect to pay dividends on our common stock in the foreseeable future. In general, in the event that we do pay dividends on shares of our common stock, such cash distributions will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. To the extent any such distributions exceed both our current and our accumulated earnings and profits, they will first be treated as a return of capital reducing your tax basis in our common stock (determined on a share by share basis), but not below zero, and then will be treated as gain from the sale of stock.

Dividends paid to a non-U.S. holder generally will be subject to a U.S. federal withholding tax at a 30% rate, or such lower rate as may be specified by an applicable income tax treaty. However, dividends that are effectively connected with the conduct of a trade or business within the United States by a non-U.S. holder (and, if required by an applicable income tax treaty, are attributable to a U.S. permanent establishment or a fixed base of the non-U.S. holder) generally will not be subject to such withholding tax, provided certain certification and disclosure requirements are satisfied (including the provision of a properly completed IRS Form W-8ECI or other applicable form). Instead, unless an applicable income tax treaty provides otherwise, such dividends will generally be subject to U.S. federal income tax on a net income basis in the same manner as if the non-U.S. holder were a United States person as defined under the Code. A corporate non-U.S. holder may be subject to an additional “branch profits tax” at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty) on its earnings and profits (subject to adjustments) that are effectively connected with its conduct of a U.S. trade or business.

A non-U.S. holder of shares of our common stock who wishes to claim the benefit of an applicable income tax treaty rate for dividends will be required (a) to complete IRS Form W-8BEN or W-8BEN-E (or other applicable form) and certify under penalty of perjury that such holder is not a United States person as defined under the Code and is eligible for treaty benefits of a reduction in the rate of, or exemption from, withholding on dividends, or (b) if shares of our common stock are held through certain foreign intermediaries, satisfy the relevant certification requirements of applicable U.S. Treasury regulations. This certification must be provided to the applicable withholding agent prior to the payment of dividends and may be required to be updated periodically if there is a change in circumstances that makes any information on such form incorrect.

It is possible that a distribution made to a non-U.S. holder may be subject to over-withholding because, for example, at the time of the distribution we or the relevant withholding agent may not be able to determine how much of the distribution constitutes dividends or the proper documentation establishing the benefits of any applicable treaty has not been properly supplied. If there are any excess amounts withheld on distributions made to a non-U.S. holder, such non-U.S. holder may obtain

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a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS. Non-U.S. holders should consult their tax advisors regarding the applicable withholding tax rules and the possibility of obtaining a refund of any excess amounts withheld.

Gain on Disposition of Shares of Common Stock

Subject to the discussions below on backup withholding and FATCA (as defined below), any gain realized by a non-U.S. holder on the sale or other taxable disposition of shares of our common stock generally will not be subject to U.S. federal income tax unless:

• the gain is effectively connected with a trade or business of the non-U.S. holder conducted in the United States (and, if required by an applicable income tax treaty, is attributable to a U.S. permanent establishment or a fixed base of the non-U.S. holder);

• the non-U.S. holder is an individual who is present in the United States for 183 days or more in the taxable year of that disposition, and certain other conditions are met; or

• we are or have been a U.S. real property holding corporation (a “USRPHC”) for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of the disposition or the period that the non-U.S. holder held shares of our common stock (the “applicable period”).

In the case of a non-U.S. holder described in the first bullet point above, any gain will be subject to U.S. federal income tax on a net income basis generally in the same manner as if the non-U.S. holder were a United States person as defined under the Code (unless an applicable income tax treaty provides otherwise), and a non-U.S. holder that is a foreign corporation may be subject to an additional “branch profits” tax at a rate of 30% (or such lower rate as may be specified by an applicable income tax treaty) on its effectively connected earnings and profits (subject to adjustments). Except as otherwise provided by an applicable income tax treaty, an individual non-U.S. holder described in the second bullet point above will be subject to a 30% tax on any gain derived from the sale or other taxable disposition, which may be offset by certain U.S. source capital losses, even though the individual is not considered a resident of the United States under the Code.

With respect to the third bullet point above, we believe we are not currently and will not become a USRPHC. However, because the determination of whether we are a USRPHC depends on the fair market value of our U.S. real property interests relative to the fair market value of our other business assets, there can be no assurance that we are not currently or will not become a USRPHC in the future. Even if we are or become a USRPHC, however, so long as our common stock is regularly traded on an established securities market, a non-U.S. holder will be subject to U.S. federal income tax on any gain in respect of our common stock only if such non-U.S. holder actually or constructively owned more than five percent of our outstanding common stock at any time during the applicable period. You should consult your own tax advisor about the consequences that could result if we are, or become, a USRPHC.

Information Reporting and Backup Withholding

The amount of dividends paid to each non-U.S. holder and any tax withheld with respect to such dividends will be reported annually to the IRS and to each such holder, regardless of whether withholding was reduced or eliminated by an applicable income tax treaty. Copies of the information returns reporting such dividends and withholding may also be made available to the tax authorities in the country in which the non-U.S. holder resides or is established under the provisions of an applicable income tax treaty or agreement.

A non-U.S. holder generally will be subject to backup withholding with respect to dividends paid to such holder unless such holder certifies under penalty of perjury that it is not a United States person as

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defined under the Code (and the payor does not have actual knowledge or reason to know that such holder is a United States person as defined under the Code), or such holder otherwise establishes an exemption.

Information reporting and, depending on the circumstances, backup withholding will apply to the proceeds of a sale or other disposition by a non-U.S. holder of shares of our common stock within the United States or conducted through certain U.S.-related financial intermediaries unless such non-U.S. holder certifies under penalty of perjury that it is not a United States person as defined under the Code (and the payor does not have actual knowledge or reason to know that the non-U.S. holder is a United States person as defined under the Code), or such non-U.S. holder otherwise establishes an exemption.

Backup withholding is not an additional tax. Any amounts withheld from a payment to a non-U.S. holder of common stock under the backup withholding rules may be allowed as a refund or a credit against a non-U.S. holder’s U.S. federal income tax liability provided the required information is timely furnished to the IRS.

Legislation Affecting Taxation of Common Stock Held by or Through Foreign Entities

Legislation enacted in 2010 (commonly known as “FATCA”), generally will impose a withholding tax of 30% on dividend income from our common stock and on the gross proceeds of a sale or other disposition of our common stock paid to (i) a “foreign financial institution” (as such term is defined in Section 1471(d)(4) of the Code) (as the beneficial owner or as an intermediary for the beneficial owner), unless such institution enters into an agreement with the U.S. government to collect and provide to the U.S. tax authorities substantial information regarding U.S. account holders of such institution (which would include certain equity and debt holders of such institution, as well as certain account holders that are foreign entities with U.S. owners), (ii) a foreign entity that is not a financial institution (as the beneficial owner or as an intermediary for the beneficial owner), unless such entity provides the withholding agent with a certification identifying the substantial United States owners of the entity, which generally includes any United States person as defined under the Code who directly or indirectly owns more than 10% of the entity or (iii) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules. The United States and other governments may enter into intergovernmental agreements that modify or supplement these rules. This legislation generally is effective for payments of dividends made after June 30, 2014 and for payments made in respect of gross proceeds from a sale or other disposition made after December 31, 2016. Under certain circumstances, a non-U.S. holder of our common stock might be eligible for refunds or credits of such taxes, and a non-U.S. holder might be required to file a U.S. federal income tax return to claim such refunds or credits. Non-U.S. holders should consult their tax advisors regarding the implications of this legislation on their investment in our common stock.

U.S. Federal Estate Tax

Shares of our common stock that are owned (or deemed to be owned) by an individual who is not a citizen or resident of the United States (as specially defined for U.S. federal estate tax purposes) at the time of death will be includable in such individual’s gross estate for U.S. federal estate tax purposes, unless an applicable estate or other tax treaty provides otherwise, and, therefore, may be subject to U.S. federal estate tax.

THE SUMMARY ABOVE OF MATERIAL U.S. FEDERAL INCOME AND ESTATE TAX CONSEQUENCES TO NON-U.S. HOLDERS IS FOR GENERAL INFORMATION ONLY AND DOES NOT CONSTITUTE TAX ADVICE. POTENTIAL PURCHASERS OF OUR COMMON STOCK ARE URGED TO CONSULT THEIR TAX ADVISORS TO DETERMINE THE U.S. FEDERAL, STATE, LOCAL AND NON-U.S. INCOME, ESTATE AND OTHER TAX AND TAX TREATY CONSIDERATIONS OF OWNING AND DISPOSING OF OUR COMMON STOCK.

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UNDERWRITING

We, the selling stockholders and the underwriters named below have entered into an underwriting agreement with respect to the shares being offered. Subject to certain conditions, each underwriter has severally agreed to purchase the number of shares indicated in the following table. Goldman, Sachs & Co. and Credit Suisse Securities (USA) LLC are the representatives of the underwriters.

Underwriters	Number of Shares
Goldman, Sachs & Co.
Credit Suisse Securities (USA) LLC
Robert W. Baird & Co. Incorporated
Stifel, Nicolaus & Company, Incorporated
SunTrust Robinson Humphrey, Inc.
Canaccord Genuity Inc.
Total

The underwriters are committed to take and pay for all of the shares being offered, if any are taken, other than the shares covered by the option described below unless and until this option is exercised.

The underwriters have an option to buy up to an additional              shares from us and the selling stockholders to cover sales by the underwriters of a greater number of shares than the total number set forth in the table above. They may exercise that option for 30 days. If any shares are purchased pursuant to this option, the underwriters will severally purchase shares in approximately the same proportion as set forth in the table above.

The following tables show the per share and total underwriting discounts and commissions to be paid to the underwriters by us and the selling stockholders. Such amounts are shown assuming both no exercise and full exercise of the underwriters’ option to purchase              additional shares.

Paid by Us	No Exercise	Full Exercise
Per Share	$	$
Total	$	$
Paid by the Selling Stockholders	No Exercise	Full Exercise
Per Share	$	$
Total	$	$

Shares sold by the underwriters to the public will initially be offered at the initial public offering price set forth on the cover of this prospectus. Any shares sold by the underwriters to securities dealers may be sold at a discount of up to $         per share from the initial public offering price. After the initial offering of the shares, the representatives may change the offering price and the other selling terms. The offering of the shares by the underwriters is subject to receipt and acceptance and subject to the underwriters’ right to reject any order in whole or in part.

We, our officers, directors, and holders of substantially all of our common stock, including the selling stockholders, have agreed with the underwriters, subject to certain exceptions, not to dispose of or hedge any of their common stock or securities convertible into or exchangeable for shares of common stock during the period from the date of this prospectus continuing through the date 180 days after the date of this prospectus, except with the prior written consent of the representatives. This agreement does not apply to any existing employee benefit plans. See “Shares Eligible for Future Sale” for a discussion of certain transfer restrictions.

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Prior to the offering, there has been no public market for the shares. The initial public offering price has been negotiated among us, the selling stockholders and the representatives. Among the factors to be considered in determining the initial public offering price of the shares, in addition to prevailing market conditions, will be our historical performance, estimates of our business potential and earnings prospects, an assessment of our management and the consideration of the above factors in relation to market valuation of companies in related businesses.

We intend to apply to list the common stock on the                      under the symbol “                    .”

In connection with the offering, the underwriters may purchase and sell shares of common stock in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the underwriters of a greater number of shares than they are required to purchase in the offering, and a short position represents the amount of such sales that have not been covered by subsequent purchases. A “covered short position” is a short position that is not greater than the amount of additional shares for which the underwriters’ option described above may be exercised. The underwriters may cover any covered short position by either exercising their option to purchase additional shares or purchasing shares in the open market. In determining the source of shares to cover the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase additional shares pursuant to the option described above. “Naked” short sales are any short sales that create a short position greater than the amount of additional shares for which the option described above may be exercised. The underwriters must cover any such naked short position by purchasing shares in the open market. A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the price of the common stock in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing transactions consist of various bids for or purchases of common stock made by the underwriters in the open market prior to the completion of the offering.

The underwriters may also impose a penalty bid. This occurs when a particular underwriter repays to the underwriters a portion of the underwriting discount received by it because the representatives have repurchased shares sold by or for the account of such underwriter in stabilizing or short covering transactions.

Purchases to cover a short position and stabilizing transactions, as well as other purchases by the underwriters for their own accounts, may have the effect of preventing or retarding a decline in the market price of our stock, and together with the imposition of the penalty bid, may stabilize, maintain or otherwise affect the market price of the common stock. As a result, the price of the common stock may be higher than the price that otherwise might exist in the open market. The underwriters are not required to engage in these activities and may end any of these activities at any time. These transactions may be effected on the                     , in the over-the-counter market or otherwise. In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State), each underwriter has represented and agreed that with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the Relevant Implementation Date) it has not made and will not make an offer of shares to the public in that Relevant Member State prior to the publication of a prospectus in relation to the shares which has been approved by the competent authority in that Relevant Member State or, where appropriate, approved in another Relevant Member State and notified to the competent authority in that Relevant Member State, all in accordance with the Prospectus Directive, except that it may, with effect from and including the Relevant Implementation Date, make an offer of shares to the public in that Relevant Member State at any time:

(a) to legal entities which are authorised or regulated to operate in the financial markets or, if not so authorised or regulated, whose corporate purpose is solely to invest in securities;

109

(b) to any legal entity which has two or more of (1) an average of at least 250 employees during the last financial year; (2) a total balance sheet of more than €43,000,000 and (3) an annual net turnover of more than €50,000,000, as shown in its last annual or consolidated accounts;

(c) to fewer than 100 natural or legal persons (other than qualified investors as defined in the Prospectus Directive) subject to obtaining the prior consent of the representatives for any such offer; or

(d) in any other circumstances which do not require the publication by the Issuer of a prospectus pursuant to Article 3 of the Prospectus Directive.

For the purposes of this provision, the expression an “offer of shares to the public” in relation to any shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the shares to be offered so as to enable an investor to decide to purchase or subscribe the shares, as the same may be varied in that Relevant Member State by any measure implementing the Prospectus Directive in that Relevant Member State and the expression Prospectus Directive means Directive 2003/71/EC and includes any relevant implementing measure in each Relevant Member State.

Each underwriter has represented and agreed that:

(a) it has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement to engage in investment activity (within the meaning of Section 21 of the FSMA) received by it in connection with the issue or sale of the shares in circumstances in which Section 21(1) of the FSMA does not apply to the Issuer; and

(b) it has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the shares in, from or otherwise involving the United Kingdom.

The shares may not be offered or sold by means of any document other than (i) in circumstances which do not constitute an offer to the public within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), or (ii) to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) and any rules made thereunder, or (iii) in other circumstances which do not result in the document being a “prospectus” within the meaning of the Companies Ordinance (Cap.32, Laws of Hong Kong), and no advertisement, invitation or document relating to the shares may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under the laws of Hong Kong) other than with respect to shares which are or are intended to be disposed of only to persons outside Hong Kong or only to “professional investors” within the meaning of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong) and any rules made thereunder.

This prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other document or material in connection with the offer or sale, or invitation for subscription or purchase, of the shares may not be circulated or distributed, nor may the shares be offered or sold, or be made the subject of an invitation for subscription or purchase, whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274 of the Securities and Futures Act, Chapter 289 of Singapore (the “SFA”), (ii) to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA or (iii) otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA.

110

Where the shares are subscribed or purchased under Section 275 by a relevant person which is: (a) a corporation (which is not an accredited investor) the sole business of which is to hold investments and the entire share capital of which is owned by one or more individuals, each of whom is an accredited investor; or (b) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments and each beneficiary is an accredited investor, shares, debentures and units of shares and debentures of that corporation or the beneficiaries’ rights and interest in that trust shall not be transferable for 6 months after that corporation or that trust has acquired the shares under Section 275 except: (1) to an institutional investor under Section 274 of the SFA or to a relevant person, or any person pursuant to Section 275(1A), and in accordance with the conditions, specified in Section 275 of the SFA; (2) where no consideration is given for the transfer; or (3) by operation of law.

The securities have not been and will not be registered under the Financial Instruments and Exchange Law of Japan (the Financial Instruments and Exchange Law) and each underwriter has agreed that it will not offer or sell any securities, directly or indirectly, in Japan or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or indirectly, in Japan or to a resident of Japan, except pursuant to an exemption from the registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Law and any other applicable laws, regulations and ministerial guidelines of Japan.

The underwriters do not expect sales to discretionary accounts to exceed five percent of the total number of shares offered.

We and the selling stockholders estimate that their share of the total expenses of the offering, excluding underwriting discounts and commissions, will be approximately $        .

We and the selling stockholders have agreed to indemnify the several underwriters against certain liabilities, including liabilities under the Securities Act of 1933.

The underwriters and their respective affiliates are full service financial institutions engaged in various activities, which may include sales and trading, commercial and investment banking, advisory, investment management, investment research, principal investment, hedging, market making, brokerage and other financial and non-financial activities and services. Certain of the underwriters and their respective affiliates have provided, and may in the future provide, a variety of these services to us and to persons and entities with relationships with us, for which they received or will receive customary fees and expenses.

In the ordinary course of their various business activities, the underwriters and their respective affiliates, officers, directors and employees may purchase, sell or hold a broad array of investments and actively trade securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments for their own account and for the accounts of their customers, and such investment and trading activities may involve or relate to assets, securities and/or instruments of the issuer (directly, as collateral securing other obligations or otherwise) and/or persons and entities with relationships with us. The underwriters and their respective affiliates may also communicate independent investment recommendations, market color or trading ideas and/or publish or express independent research views in respect of such assets, securities or instruments and may at any time hold, or recommend to clients that they should acquire, long and/or short positions in such assets, securities and instruments.

111

LEGAL MATTERS

Kirkland & Ellis LLP, New York, New York will pass upon the validity of the common stock offered hereby on our behalf. Certain legal matters in connection with this offering will be passed upon for the underwriters by Latham & Watkins  LLP, New York, New York.

EXPERTS

The consolidated financial statements of Freshpet, Inc. and its subsidiary as of December 31, 2013 and 2012, and for each of the years in the two-year period ended December 31, 2013, have been included herein and in the registration statement in reliance upon the reports of KPMG LLP, an independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.

WHERE YOU CAN FIND MORE INFORMATION

We have filed with the SEC a registration statement on Form S-1, including exhibits and schedules, under the Securities Act with respect to the shares of our common stock offered hereby. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits and schedules filed therewith. For further information with respect to us and the common stock offered hereby, reference is made to the registration statement and the exhibits and schedules filed therewith. Statements contained in this prospectus regarding the contents of any contract or any other document that is filed as an exhibit to the registration statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the registration statement.

Upon completion of this offering, we will become subject to the information and periodic and current reporting requirements of the Exchange Act, and, in accordance therewith, will file periodic and current reports, proxy statements and other information with the SEC. Such periodic and current reports, proxy statements and other information will be available to the public on the SEC’s website at www.sec.gov and free of charge through our website at www.freshpet.com. To receive copies of public records not posted to the SEC’s website at prescribed rates, you may complete an online form at www.sec.gov, send a fax to (202) 772-9337 or submit a written request to the SEC, Office of FOIA/PA Operations, 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information. Please note that our website address is provided as an inactive textual reference only. The information contained on, or accessible through, our website is not part of this prospectus and is therefore not incorporated by reference.

112

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

	Page
Audited Consolidated Financial Statements
Report of Independent Registered Public Accounting Firm		F-2
Consolidated Balance Sheets as of December 31, 2013 and 2012		F-3
Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2013 and 2012		F-4
Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the years ended December  31, 2013 and 2012		F-5
Consolidated Statement of Cash Flows for the years ended December 31, 2013 and 2012		F-6
Notes to Consolidated Financial Statements		F-7
Unaudited Interim Consolidated Financial Statements
Consolidated Balance Sheets as of June 30, 2014 and December 31, 2013		F-24
Consolidated Statements of Operations and Comprehensive Loss for the six months ended June 30, 2014 and 2013		F-25
Consolidated Statement of Cash Flows for the six months ended June 30, 2014 and 2013		F-26
Notes to Unaudited Interim Consolidated Financial Statements		F-27

F-1

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders

Freshpet, Inc.:

We have audited the accompanying balance sheets of Freshpet, Inc. and subsidiary (the Company) as of December 31, 2013 and 2012, and the related consolidated statements of operations and comprehensive loss, changes in stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended December 31, 2013. These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Freshpet, Inc. and subsidiary as of December 31, 2013 and 2012, and the results of their operations and their cash flows for each of the years in the two-year period ended December 31, 2013, in conformity with U.S. generally accepted accounting principles.

/s/    KPMG LLP

June 27, 2014

Short Hills, NJ

F-2

FRESHPET, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

	December 31,
	2013			2012
ASSETS
CURRENT ASSETS:
Cash and equivalents	$	2,444,754		$	1,633,249
Accounts receivable, less allowance for doubtful accounts of $243,777 in 2013 and $215,787 in 2012		3,497,596			2,778,477
Inventories, net		5,512,225			3,823,929
Prepaid expenses and other current assets		173,786			144,256
Total Current Assets		11,628,361			8,379,911
Property, plant and equipment, net		48,764,032			33,173,751
Deposits on equipment		1,183,209			1,953,658
Other assets		1,041,622			586,904
Total Assets	$	62,617,224		$	44,094,224
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable	$	6,286,720		$	9,206,274
Accrued expenses		1,907,481			2,284,212
Total Current Liabilities		8,194,201			11,490,486
OTHER LIABILITIES:
Long-term debt		1,112,312			1,056,928
Notes payable		75,000,000			43,000,000
Accrued fees on debt guarantee		7,140,136			1,895,436
Accrued interest on long term debt		667,110			469,647
Other Liabilities		369,564			369,564
Total Liabilities	$	92,483,323		$	58,282,061
COMMITMENTS AND CONTINGENCIES
REDEEMABLE PREFERRED STOCK:
Series B, $0.001 par value, 250,000 shares authorized, 112,160 shares issued and outstanding in 2013 and 2012		30,728,450			26,513,220
Series C, $0.001 par value, 15,000,000 shares authorized, 11,238,098 and 10,285,715 shares issued and outstanding in 2013 and 2012, respectively		70,463,489			61,102,565
STOCKHOLDERS’ EQUITY (DEFICIT):
Common stock – voting, $0.001 par value, 54,000,000 shares authorized, 14,035,660 shares issued and outstanding in 2013, 14,024,908 shares issued and outstanding in 2012		14,036			14,025
Additional paid-in capital		16,446,560			24,013,832
Accumulated deficit		(147,518,634	)		(125,831,479	)
Total Stockholders’ Deficit		(131,058,038	)		(101,803,622	)
Total Liabilities and Stockholders’ Deficit	$	62,617,224		$	44,094,224

See accompanying notes to consolidated financial statements

F-3

FRESHPET, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

	Year Ended December 31,
	2013			2012
NET SALES	$	63,150,776		$	43,519,461
COST OF GOODS SOLD		35,957,835			22,881,333
GROSS PROFIT		27,192,941			20,638,128
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES		39,573,617			35,385,319
LOSS FROM OPERATIONS		(12,380,676	)		(14,747,191	)
OTHER EXPENSES:
Other Expenses		(537,812	)		(343,212	)
Fees on Debt Guarantee		(5,244,700	)		(1,895,436	)
Interest Expense		(3,492,442	)		(1,637,883	)
		(9,274,954	)		(3,876,531	)
LOSS BEFORE INCOME TAXES		(21,655,630	)		(18,623,722	)
INCOME TAX EXPENSE		31,525			32,776
NET LOSS		(21,687,155	)		(18,656,498	)
OTHER COMPREHENSIVE INCOME:
Foreign Currency Translation Adjustment		—			23,829
TOTAL COMPREHENSIVE LOSS	$	(21,687,155	)	$	(18,632,669	)
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS	$	(30,282,659	)	$	(26,609,946	)
NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS:
BASIC	$	(2.16	)	$	(1.90	)
DILUTED	$	(2.16	)	$	(1.90	)
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING USED IN COMPUTING NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS:
BASIC		14,026,999			14,024,908
DILUTED		14,026,999			14,024,908
PRO FORMA NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS (UNAUDITED):
BASIC	$			$
DILUTED	$			$
PRO FORMA WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING USED IN COMPUTING PRO FORMA NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS (UNAUDITED):
BASIC
DILUTED

See accompanying notes to consolidated financial statements

F-4

FRESHPET, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

	Common Stock – Voting				Additional Paid-in Capital			Accumulated Deficit			Accumulated Other Comprehensive Loss			Total Stockholders’ Deficit
	Number of Shares Issued		Amount
BALANCES, DECEMBER 31, 2011		14,024,908	$	14,025	$	30,815,054		$	(107,174,981	)	$	(23,829	)	$	(76,369,731	)
YEAR ENDED DECEMBER 31, 2012:
Issuance of 6,668 common stock options to consultants for services		—		—		27,365			—			—			27,365
Issuance of 6,000 common stock options to employees as compensation for service		—		—		6,156			—			—			6,156
Share-based compensation expense		—		—		1,118,705			—			—			1,118,705
Series B Preferred Stock dividend accretion		—		—		(3,638,052	)		—			—			(3,638,052	)
Series C Preferred Stock dividend accretion		—		—		(4,315,396	)		—			—			(4,315,396	)
Foreign currency translation adjustment		—		—		—			—			23,829			23,829
Net loss		—		—		—			(18,656,498	)		—			(18,656,498	)
BALANCES, DECEMBER 31, 2012		14,024,908	$	14,025	$	24,013,832		$	(125,831,479	)	$	—		$	(101,803,622	)
YEAR ENDED DECEMBER 31, 2013:
Issuance of 10,752 shares of common stock for cash		10,752		11		49,880			—			—			49,891
Share-based compensation expense		—		—		978,352			—			—			978,352
Series B Preferred Stock dividend accretion		—		—		(4,215,230	)		—			—			(4,215,230	)
Series C Preferred Stock dividend accretion		—		—		(4,380,274	)		—			—			(4,380,274	)
Net loss		—		—		—			(21,687,155	)		—			(21,687,155	)
BALANCES, DECEMBER 31, 2013		14,035,660	$	14,036	$	16,446,560		$	(147,518,634	)	$	—		$	(131,058,038	)

See accompanying notes to consolidated financial statements

F-5

FRESHPET, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENT OF CASH FLOWS

	December 31,
	2013			2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(21,687,155	)	$	(18,656,498	)
Adjustments to reconcile net loss to net cash flows from operating activities:
Provision for losses on accounts receivable		202,653			157,306
Loss on disposal of equipment and deposits on equipment		503,436			332,877
Fees on debt guarantee		5,244,700			1,895,436
Share-based compensation		978,352			1,118,705
Issuance of common stock options for services		—			33,521
Change in reserve for inventory obsolescence		150,540			(188,007	)
Depreciation and amortization		5,945,077			4,593,668
Customer list amortization		—			134,337
Amortization of loan discount		55,384			55,384
Amortization of deferred financing costs		183,541			49,644
Changes in operating assets and liabilities:
Accounts receivable		(921,772	)		(1,599,443	)
Inventories		(1,838,836	)		(758,428	)
Prepaid expenses and other current assets		(29,530	)		(33,221	)
Other assets		(139,094	)		(63,891	)
Accounts payable		290,770			2,747,074
Accrued expenses and accrued interest on long-term debt		(179,268	)		1,465,611
Net cash flows used in operating activities		(11,241,202	)		(8,715,925	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions of property, plant and equipment and deposits on equipment		(24,451,832	)		(26,395,114	)
Acquisitions of software		(191,184	)		—
Proceeds from sale of equipment		—			89,428
Net cash flows used in investing activities		(24,643,016	)		(26,305,686	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on notes payable		32,000,000			33,000,000
Financing fees paid in connection with note payable		(334,818	)		(340,418	)
Proceeds from issuance of common stock		49,889			—
Proceeds from issuance of preferred stock – Series C		4,980,652			1,103,218
Net cash flows from financing activities		36,695,723			33,762,800
EFFECT OF EXCHANGE RATE CHANGES ON CASH		—			23,829
NET CHANGE IN CASH AND EQUIVALENTS		811,505			(1,234,982	)
CASH AND EQUIVALENTS, BEGINNING OF YEAR		1,633,249			2,868,231
CASH AND EQUIVALENTS, END OF YEAR	$	2,444,754		$	1,633,249
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid, including capitalized interest of $190,497 in 2012	$	2,926,355		$	1,466,346
NON-CASH FINANCING ACTIVITY:
Preferred stock dividend accretion	$	8,595,504		$	7,953,448

See accompanying notes to consolidated financial statements

F-6

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 – Nature of the Business and Summary of Significant Accounting Policies:

Nature of the Business – Freshpet, Inc. (hereafter referred to as “Freshpet” or the “Company”), a Delaware corporation, manufactures and markets natural fresh, refrigerated meals and treats for dogs and cats. The Company’s products are distributed throughout the United States and Canada into major retail classes including Grocery and Mass (which includes club) as well as Pet specialty and Natural retail.

Principles of Consolidation – The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”). The financial statements include the accounts of the Company and its wholly-owned subsidiary, Professor Connor’s Canada Inc. (“PCCI”). In 2012, the Company began merging the operations of PCCI into those of Freshpet. All significant intercompany accounts and transactions have been eliminated in consolidation.

Estimates and Uncertainties – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results, as determined at a later date, could differ from those estimates.

Cash and Cash Equivalents – The Company considers money market funds and all other highly liquid debt instruments purchased with an original maturity of three months or less to be cash equivalents.

Accounts Receivable – The Company records trade accounts receivable at net realizable value. This value includes an appropriate allowance for estimated uncollectible accounts. On a periodic basis, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts based on its history of write-offs and collections and current credit conditions. Accounts receivable are written off when management deems them to be uncollectible.

Inventories – Inventories are stated at the lower of cost or market, using the first-in, first-out method. When necessary, the Company provides allowances to adjust the carrying value of its inventories to the lower of cost or net realizable value, including any costs to sell or dispose and consideration for obsolescence, excessive inventory levels, product deterioration and other factors in evaluating net realizable value.

Property, Plant and Equipment – Property, plant and equipment are recorded at cost. The Company provides for depreciation on the straight-line method by charges to income at rates based upon estimated recovery periods of 7 years for furniture and office equipment, 5 years for automotive equipment, 3 – 6 years for refrigeration equipment, 5 – 10 years for machinery and equipment, and 15 – 39 years for building and improvements. Capitalized cost includes the costs incurred to bring the property, plant and equipment to the condition and location necessary for its intended use, which includes any necessary delivery, electrical and installation cost for equipment. Maintenance and repairs that do not extend the useful life of the assets over two years are charged to expense as incurred. Leasehold improvements are amortized over the shorter of the term of the related lease or the estimated useful lives on the straight-line method.

Long-Lived Assets – The Company evaluates all long-lived assets for impairment. Long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate the

F-7

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

carrying value of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated undiscounted future net cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. Recoverability of assets held for sale is measured by a comparison of the carrying amount of an asset or asset group to their fair value less estimated costs to sell. Estimating future cash flows and calculating fair value of assets requires significant estimates and assumptions by management. If the carrying amount is not fully recoverable, an impairment loss is recognized to reduce the carry amount to fair value, and is charged to expense in the period of impairment. 

Income Taxes – The Company provides for deferred income taxes for temporary differences between financial and income tax reporting, principally net operating loss carryforwards, depreciation, and share-based compensation. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the years in which those temporary differences are expected to be recovered or settled.

A valuation allowance is appropriate when management believes it is more likely than not, the deferred tax asset will not be realized. At December 31, 2013 and 2012, the Company has determined that a valuation allowance of approximately 100% is deemed appropriate.

Revenue Recognition and Incentives – Revenue from product sales is recognized upon shipment to the customers as terms are free on board (FOB) shipping point, at which point title and risk of loss is transferred and the selling price is fixed or determinable. This completes the revenue-earning process specifically that an arrangement exists, delivery has occurred, ownership has transferred, the price is fixed and collectability is reasonably assured. A provision for payment discounts and product return allowances, which is estimated based upon the Company’s historical performance, management’s experience and current economic trends, is recorded as a reduction of sales in the same period that the revenue is recognized.

Trade incentives, consisting primarily of customer pricing allowances and merchandising funds, and consumer coupons are offered through various programs to customers and consumers. Sales are recorded net of estimated trade incentive spending, which is recognized as incurred at the time of sale. Accruals for expected payouts under these programs are included as accrued expense in the consolidated balance sheet. Coupon redemption costs are also recognized as reductions of net sales when the coupons are issued. Estimates of trade promotion expense and coupon redemption costs are based upon programs offered, timing of those offers, estimated redemption/usage rates from historical performance, management’s experience and current economic trends.

Advertising – Advertising costs, consisting primarily of media ads, are expensed as incurred. Advertising costs in 2013 and 2012 were approximately $12,037,402 and $10,666,163, respectively.

Shipping and Handling Costs/Freight Out – Costs incurred for shipping and handling are included in selling, general, and administrative expenses within the statement of operations and comprehensive loss. Shipping and handling costs primarily consist of costs associated with moving finished products to customers, including costs associated with distribution center and the cost of shipping products to customers through third-party carriers. Shipping and handling cost totaled $6,872,953 and $5,170,367 for the years ended 2013 and 2012, respectively. Shipping and handling costs billed to customers are included in sales.

F-8

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Foreign Currency Translation – The financial position and results of operations of PCCI’s foreign subsidiary are measured using local currency as the functional currency. Assets and liabilities principally are translated at the exchange rate in effect at each year-end. The statements of operations are generally translated at the weighted-average rate of exchange prevailing during the year. The statements of cash flows are generally translated at the average rate of exchange prevailing during the year. Translation adjustments arising from differences in exchange rates from period to period are included in accumulated other comprehensive loss.

Share Based Compensation – The Company recognizes share based compensation based on the value of the portion of share-based payment awards that is ultimately expected to vest during the period. Share-based compensation expense recognized in the statement of operations for the years ended December 31, 2013 and 2012 included compensation expense for share based payment awards granted subsequent to December 31, 2005, based on the grant date fair value estimated. Share awards are amortized under the straight-line method. As share based compensation expense recognized in the statement of operations for the years ended December 31, 2013 and 2012 is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. Forfeitures are to be estimated at the time of the grant, and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. Pre-vesting forfeitures were estimated to be 0% for employees for the years ending December 31, 2013 and 2012 based on historical experiences.

The Company accounts for the stock options granted to non-employees. The Company determines the fair value of the stock options granted as either the fair value of the consideration received or the fair value of the equity instruments issued, whichever is more reliably measurable.

Total compensation cost for share-based payments recognized for the years ended December 31, 2013 and 2012 was approximately $978,352 and $1,118,705, respectively. Cost of goods sold, and selling, general and administrative expense for the year ended December 31, 2013 included share based compensation of approximately $90,614 and $887,738, respectively. Cost of goods sold and selling, general, and administrative expense for the year ended December 31, 2012 included share-based compensation of approximately $107,067 and $1,011,638, respectively. See note 12.

Fair Value of Financial Instruments – Financial Accounting Standards Board (FASB) guidance specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).

The three levels of the fair value hierarchy are as follows:

• Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities.

• Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active). Level 2 includes financial instruments that are valued using models or other valuation methodologies.

F-9

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

• Level 3 – Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.

The carrying amounts reported in the balance sheets for cash and cash equivalents, other receivables, accounts payable and accrued expenses approximate their fair value based on the short-term maturity of these instruments. The warrant liability is recorded at fair value with changes in fair value reflected in the statement of operations and comprehensive loss.

Pro forma Net Loss per share (unaudited)

Note 2 – Inventories:

Inventories are summarized as follows:

	December 31,
	2013			2012
Raw materials	$	1,431,422		$	1,187,339
Packaging components material		805,424			666,843
Finished goods		3,459,707			2,003,535
		5,696,553			3,857,717
Reserve for obsolescence		(184,328	)		(33,788	)
	$	5,512,225		$	3,823,929

Note 3 – Property, Plant and Equipment:

Property, plant and equipment, net are summarized as follows:

	December 31,
	2013			2012
Refrigeration equipment	$	35,649,423		$	24,739,093
Machinery and equipment		20,767,207			6,023,755
Building and improvements		9,892,291			—
Furniture and office equipment		1,727,248			594,374
Leasehold improvements		1,474,741			1,737,598
Construction in progress		143,274			16,111,016
Automotive equipment		313,930			380,604
		69,968,114			49,586,440
Less: Accumulated depreciation and amortization		(21,204,082	)		(16,412,689	)
	$	48,764,032		$	33,173,751

Depreciation and amortization expense related to property, plant and equipment totaled approximately $5,945,077 and $4,593,668 for the years ended December 31, 2013 and 2012, respectively; of which $2,204,282 and $803,654 was recorded in cost of goods sold for 2013 and 2012, respectively, with the remainder of depreciation and amortization expense being recorded to selling, general and administrative expense.

During June 2013, the Company made a decision to exit its leased manufacturing facility in Quakertown, PA. The Company recognized accelerated depreciation of approximately $827,370 during 2013 related to the facility assets that were not going to be redeployed at the Company’s manufacturing facility. These assets were written down to their net realizable value and sold during 2014. The proceeds received from the sale of assets were less than the book value of the assets.

F-10

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

During 2013, the Company completed the construction of a manufacturing facility in Bethlehem, Pennsylvania. The costs associated with this facility were reclassified from construction in progress to depreciable assets during 2013 when the facility was ready for its intended use.

Note 4 – Income Taxes:

A summary of income taxes as follows:

	December 31,
	2013		2012
Deferred:
Federal	$	—	$	—
State		31,525		32,776
	$	31,525	$	32,776

The provisions for income taxes do not bear a normal relationship to loss before income taxes primarily as a result of the valuation allowance on deferred tax assets.

The most significant jurisdictions in which the Company is required to file income tax returns include the U.S. federal jurisdiction, the States of New Jersey, California, Indiana, Pennsylvania and Texas. The Company is no longer subject to U.S. Federal income tax examinations for year ends prior to 2010. With limited exceptions, the Company is no longer subject to state income tax examinations for year ends prior to 2009.

The reconciliation of the statutory federal income tax rate to the Company’s effective tax is presented below:

	December 31,
	2013			2012
Tax at federal statutory rate		34.00%			34.00%
State taxes, net of federal		(0.10%	)		0.11%
Permanent items		(0.37%	)		(0.84%	)
Other		0.33%			0.55%
Valuation allowance		(34.00%	)		(34.00%	)
Benefit from income taxes		(0.14%	)		(0.18%	)

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows:

	December 31,
	2013			2012
Net operating loss carryforwards	$	48,735,783		$	41,034,013
Fees on debt guarantee		2,692,877			721,670
Stock option expense		1,028,880			707,505
Property and equipment		(1,675,683	)		454,480
Other		1,026,231			1,284,161
Less: Valuation allowance		(51,808,088	)		(44,201,829	)
Net deferred tax	$	—		$	—

F-11

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In assessing the realizability of the net deferred tax assets, the Company considers all relevant positive and negative evidence to determine whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized. The realization of the gross deferred tax assets is dependent on several factors, including the generation of sufficient taxable income prior to the expiration of the net operating loss carryforwards. The Company believes that it is more likely than not that the Company’s deferred income tax assets will not be realized in the immediate future. As such, there was a full valuation allowance against the net deferred tax assets as of December 31, 2012 and 2013.

At December 31, 2013, the Company had federal net operating loss (“NOL”) carryforwards of approximately $131,966,628 which expire between 2025 and 2033. The Company may be subject to certain limitations in its annual utilization of net operating loss carryforwards to off-set future taxable income pursuant to Section 382 of the Internal Revenue Code, which could result in NOLs expiring unused. At December 31, 2013, the Company had approximately $124,069,959 of NJ NOLs which expire between 2014 and 2033.

Entities are also required to evaluate, measure, recognize and disclose any uncertain income tax provisions taken on their income tax returns. The Company has analyzed its tax positions and has concluded that as of December 31, 2013, there were no uncertain positions. The federal and state income tax returns of the Company for 2010, 2011 and 2012 are subject to examination by the IRS and state taxing authorities, generally for three years after they were filed. Interest and penalties, if any, as they relate to income taxes assessed, are included in the income tax provision. There was no income tax related interest and penalties included in the income tax provision for 2013 and 2012.

Net deferred tax assets and liabilities are summarized as follows:

	December 31,
	2013			2012
Total deferred tax assets	$	53,483,771		$	44,201,829
Total deferred tax liabilities		(1,675,683	)		—
Valuation allowance		(51,808,088	)		(44,201,829	)
Net deferred income tax assets	$	—		$	—

Note 5 – Accrued Expenses:

Accrued expenses are summarized as follows:

	December 31,
	2013		2012
Other accrued expenses	$	436,419	$	212,464
Accrued coupons		32,118		140,000
Accrued payroll		616,880		408,044
Accrued bonuses		515,000		1,215,700
Accrued interest		307,064		308,004
	$	1,907,481	$	2,284,212

F-12

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 6 – Debt:

a. $1,500,000 10% Note

Consists of $1,500,000 of notes issued to stockholders which accrue interest compounded annually at a rate of 10%. These notes and all accrued interest are due on December 23, 2020.

In connection with the issuance of these notes in February 2010, for every $16.39 that was borrowed with the notes, 1 share of common stock was issued to the lender. As a result, 91,528 shares of common stock were issued and fair value of the stock at issuance, $6.56 a share, was recorded as a discount to the debt. The unamortized discount equaled $387,688 and $443,072 at December 31, 2013 and 2012, respectively. The amortization expense of $55,384 is recorded within interest expense in the statement of operations and comprehensive loss. The accrued interest totaled $667,110 and $470,145 at December 31, 2013 and 2012, respectively.

b. $15,000,000 Revolving Note Payable

The $15,000,000 revolving note payable matures on October 31, 2015. The borrowings bear interest at either a LIBOR Rate plus 8% margin or a Base Rate plus 6%, depending on the election of the Company. Base Rate is defined as the rate of interest publicly quoted by The Wall Street Journal as the “base rate on corporate loans posted by at least 75% of the nation’s 30 largest banks.” If the Company elects to utilize the LIBOR Rate, it then elects to use a 1, 2, or 3 month LIBOR Rate with the interest payable upon the last day of the interest period applicable to the Company’s LIBOR rate election. Interest for the Base Rate loan is payable monthly with the balance of any outstanding advances due at maturity. An unused line of credit fee of 1%, payable monthly, is charged for any portion of the line that is not used, unless at least $3 million is kept on deposit with the bank. The Company has not kept a $3 million deposit with the bank.

The loan is collateralized by substantially all of the Company’s assets. The loan agreement provides for the maintenance of various financial covenants. The Company is currently in compliance with these requirements. Borrowings on this revolving note payable totaled $15,000,000 at December 31, 2013 and 2012. The recorded carrying values of our debt balances approximate fair value given our debt is at variable rates tied to market indicators or is short-term in nature. In March 2014, this revolving note payable was amended to increase the borrowing availability under the note to $20,000,000.

c. $60,000,000 Revolving Note Payable

The Company entered into a $60,000,000 revolving line of credit agreement with a maturity date of May 1, 2016. Subject to certain conditions, the maturity date may be extended until May 1, 2017 upon delivery of legal opinions stating that the majority lender has the right to call capital up through May 1, 2017. The borrowings bear interest at either a LIBOR Rate (LIBOR Adjusted Rate, plus 3.25%) or a Base Rate (Base Rate plus 2.25%). Base rate is defined as the greater of the Prime Rate on the date of the borrowing and the Federal Funds Effective Rate plus 0.5%. Interest on Base Rate Loans are payable monthly, LIBOR Rate loans are payable at the end of the selected interest rate. This note payable is subordinated to the $15,000,000 revolving note payable except for the first mortgage on the Bethlehem, PA property. The loan agreement provides for the maintenance of certain financial covenants. The Company is currently in compliance with these requirements. Borrowings on this revolving note payable totaled $60,000,000 at December 31, 2013 and $28,000,000 at December 31, 2012.

F-13

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In connection with this note, the Company entered into a Fee and Reimbursement Agreement with certain stockholders who were also guarantors of the note. See note 11 for further detail.

Note 7 – Commitments:

Leases – The Company leases office and warehouse space under non-cancelable operating leases that expire at various dates through January 31, 2015. As of December 31, 2013, future minimum rentals due under these leases were as follows:

Year Ended December 31,
2014	$	222,853
2015		13,104
	$	235,957

Rent expense related to these non-cancelable operating leases was $481,269 and $326,523 for the years ended December 31, 2013 and 2012, respectively.

Employment Agreements – The Company is committed under the terms of employment agreements to pay three officers through the first anniversary of the date of a change in control event, at which time the commitments will automatically renew for additional one year periods, until termination by either party.

Note 8 – Non-employee Common Stock Options for Service:

Issuance of Common Stock Options for Services – On January 31, 2012, options to purchase 6,668 shares of common stock were issued to a consultant for services received. The stock options were valued at $4.10 per share. These options become exercisable in December 2015 and expire January 2022. The estimated fair value of these options was recorded as a non-cash stock issuance cost. The total amount expensed associated with these options was approximately $27,000 for the year ended December 31, 2012.

On June 1, 2012, options to purchase 5,000 shares of common stock were issued to a consultant for services received. These options become fully exercisable when certain performance conditions are met, and expire in June 2022. As of December 31, 2012, the performance conditions required to exercise these options were not met and no expense was recorded related to these options in 2012.

No options were issued to non-employees for services during 2013.

Note 9 – Redeemable Preferred Stock:

The redeemable preferred stock at December 31, 2013 consists of the following:

Series	Shares Authorized		Shares Issued and Outstanding		Proceeds, Net of Issuance Costs
Preferred Stock B		250,000		112,160	$	11,159,992
Preferred Stock C		15,000,000		11,238,098		57,790,564
		15,250,000		11,350,258	$	68,950,556

F-14

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Voting

Holders of Series B Preferred Stock (“Series B”) are not entitled to cast votes on any matters presented to the stockholders of the Corporation for their action at any meeting of stockholders of the Corporation.

Holders of Series C Preferred Stock (“Series C”) are entitled to cast a number of votes equal to the number of whole shares of common stock into which such holder’s shares of convertible preferred stock are convertible as of the applicable record date.

Dividends

Holders of Series B shall be entitled to receive dividends payable in additional fully paid and non-assessable shares of Series B at a rate per annum of 15% of the original issue price. Such dividends shall be fully cumulative from the first day of issuance and shall accrue without interest on both the initial Series B shares obtained and shares obtained via dividend, on a quarterly basis. The dividend accrued during the year ended 2013 and 2012 was $4,215,230 and $3,638,052, respectively. The total cumulative dividends as of December 31, 2013 were $19,568,458.

Holders of Series C Preferred Stock shall be entitled to dividends at a rate of 8% per annum of the Series C original issue price, subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to Series C. Accrued dividends shall be payable only when, and if declared by the Board of Directors. In addition, holders of Series C are entitled to share ratably in any cash dividends declared and paid on the common stock in an amount per share equal to the amount of the dividend proposed to be paid on a share of common stock multiplied by the number of shares of common stock issuable upon conversion of the Series C. If Series C shares are converted to common stock, whether converted voluntarily or through a mandatory trigger event, the accrued dividends that have not been declared by the Board of Directors will be relinquished. The dividend accrued during the year ended 2013 and 2012 was $4,380,274 and $4,315,396, respectively. The total cumulative dividends as of December 31, 2013 were $12,672,925.

Series B and Series C have been classified on the balance sheet outside of permanent equity.

Conversion

Holders of Series B may not convert their shares to any other class of share, including but not limited to shares of common stock.

Each share of Series C shall be convertible, at the option of the holder and without the payment of additional consideration into such number of fully paid and non-assessable shares of common stock as is determined by dividing the Series C original issue price by the Series C conversion price. The conversion price and the rate at which shares of Series C may be converted into shares of common stock, shall be subject to adjustments relating to but not limited to subdivision or combination of common stock; reorganization, reclassification, consolidation, merger, or sale; and adjustments for diluting issues. As a result, the conversion ratio of convertible preferred stock to common stock would be adjusted accordingly. As of December 31, 2013 the conversion rate of convertible preferred stock was 1-for-1.

In addition there is a mandatory conversion that would be triggered upon the closing of the sale of shares of common stock to the public at a price of at least $16.00 per share (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization

F-15

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

with respect to the common stock), in a firm-commitment underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933 resulting in at least $75,000,000 of gross proceeds to the Company. Upon the trigger event all outstanding shares of Series C Preferred Stock shall automatically be converted in shares of common stock, at the then effective conversation rate and such shares may not be reissued by the Company.

Liquidation

Upon liquidation, dissolution, winding up of the Company, or certain merger or consolidations in which the Company or a subsidiary of the Company is a constituent party and the Company issues shares of its capital stock pursuant to such merger or consolidation, the holders of shares of Series B and Series C shall be entitled to be paid out of the assets of the Corporation available for distribution, before any payment shall be made to the holders of common stock or any other class or series of capital stock on a pari passu basis.

The holders of the Series B Preferred Stock would be entitled to be paid out an amount per share equal to the Series B original issue price. The holders of the Series C would be entitled to be paid out an amount equal to the greater of (i) the per share amount equal of the Series C original issue price or (ii) the amount to which the holder of a share of Series C Preferred Stock would be entitled to receive if such share of Series C Preferred Stock was converted into common stock. In addition Series B holders are also entitled to be paid, with respect to the aggregate number of shares of Series B received by such holders on each dividend payment date through the date of the liquidation. The holders of Series C shall be entitled to be paid, an amount in cash equal to any and all accrued but unpaid dividends. If upon any liquidation event, the assets of the Company available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series B and Series C the full amount to which they shall be entitled, the holders of the Series Preferred Stock shall share ratable in any distribution of the assets available for distribution in proportion to the respective amounts that would otherwise be payable in respect of the shares held by them upon distribution if all amounts payable on or with respect to such shares were paid in full.

Redemption Rights

At any time on or after December 23, 2015 all then outstanding shares of Series C may be redeemed, as long as written notice is received by the Company from the holders of at least a majority of the then outstanding shares of Series C requesting redemption of all shares of Series C, at a price equal to the Series C original issue price per share, plus an amount in cash equal to any and all accrued but unpaid dividends. Upon receipt of the redemption notice by the Company, notice to Series B shareholders must be given by the Company stating that they received notice of redemption from the Series C shareholders. Upon receipts of the notice, the holders of the Series B may elect to redeem their shares with a majority vote from the Series B shareholders. The Series B shareholders will be entitled to the original issue price plus an amount in cash equal to any and all accrued but unpaid dividends.

Note 10 – Warrant:

In connection with a loan transaction with a bank prior to 2011, and in consideration thereof, the Company issued to a bank a warrant to purchase up to an aggregate of 82,634 shares of voting common stock of the Company at a purchase price of $4.64 per share. In the event the Company

F-16

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

issues additional equity instruments at a purchase price or exercise price lower than the warrant exercise price, such exercise price shall be adjusted. This warrant was recorded as a liability with adjustments to fair value recorded in the statement of operations.

This warrant is exercised upon surrender to the Company, on a net basis, such that, without the exchange of any funds, such holder purchases that number of shares otherwise issuable upon exercise of its warrant less that number of shares having a current market price at the time of exercise equal to the aggregate exercise price that would otherwise have been paid by such holder upon the exercise of the warrant.

This warrant automatically converts in October 2017 without any action by the holder.

Note 11 – Guarantee Agreement:

In connection with the $60,000,000 revolving note payable (see note 6), the Company entered into a Fee and Reimbursement Agreement with certain stockholders who were also guarantors of the note. That agreement stipulated that the Company will pay each guarantor a contingent fee equal to 10% per annum of the amount that each guarantor has committed to guarantee. The payment will be made in the form of newly issued shares of Series C Preferred Stock at the price of $5.25 per share. The fee accrues only from and after the date that the Guarantor enters into the Guarantee, and if at any time any Guarantor’s obligation is terminated in full or in part, the Fee shall continue to accrue only with respect to the amount, if any of such Guarantor’s remaining commitment under the Credit Agreement. The fee is contingent in that it will become due and payable only if all principal and interest under the credit agreement has been repaid and a Change of Control has occurred. A Change of Control is defined as any sale, merger, consolidation, share exchange, business combination, equity issuance, or other transaction or series of related transactions, specifically excluding public offerings, which result in the stockholders immediately prior to the transaction(s) owning collectively less than 50% of the voting control immediately following the transaction(s); or (ii) any sale, lease, exchange, transfer, or other disposition of substantially all of the assets, taken as a whole, in a single transaction or series of transactions, excluding sales in the ordinary course of business, sale/leaseback and corporate restructuring transactions.

The Guarantee is a financial instrument recognized as a liability by the Company and recorded at fair value at issuance. The instrument is adjusted to its then fair value at each reporting period with changes in fair value recorded in the consolidated statement of operations and comprehensive loss. As of December 31, 2013, the Company measured the fair value of the outstanding fee on debt guarantee using an option pricing method with several possible distribution outcomes depending on the timing and kind of liquidity event. Expected volatility is estimated utilizing the historical volatility of similar companies. The risk-free interest rates are based on the U.S. Treasury yield for a period consistent with the expected contractual life. The following assumptions were utilized:

	December 31, 2013
Expected volatility		17.0	%
Remaining contractual life (in years)		1.5
Risk-free interest rate		0.2	%
Expected dividend yield		0.0	%

The Company categorized the fees on debt guarantee as a Level 3 financial liability since there is no market activity for the underlying Preferred C Stock.

F-17

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities:

Beginning Balance	$	—
Adjustment to fair value		1,895,436
Balance at December 31, 2012		1,895,436
Adjustment to fair value		5,244,700
Balance at December 31, 2013	$	7,140,136

Note 12 – Equity Incentive Plans:

2006 Stock Plan – In December 2006, the Company approved the 2006 Stock Plan (the “2006 Plan”) under which options to purchase approximately 844,000 shares of the Company’s common stock were granted to employees and affiliates of the Company. These options vest over 5 years and approximately $58,629 was recorded as an expense in 2013 and $192,670 in 2012. Certain option awards provide for accelerated vesting if there is a change in control (as defined in the 2006 Plan). At December 31, 2013 there were zero shares available for grant as the plan is frozen. The options granted have maximum contractual terms ranging from 5 to 10 years.

2010 Stock Plan – In December 2010, the Company approved the 2010 Stock Plan (the “2010 Plan”) under which options to purchase approximately 2,902,000 shares of the Company’s common stock were granted to employees and affiliates of the Company (in 2012, the 2010 Plan was amended to allow for option to purchase approximately 3,002,000 shares of the Company’s common stock). These options are either time-based (vest over 4 years), performance-based (vest when performance targets are met, as defined in the stock option grant agreement), or vest at the occurrence of an exit event which is defined as a Change of Control in the Company or an initial public offering under the Securities Act, as defined in the stock option grant agreement. Approximately $919,726 and $932,192 was recorded as an expense in 2013 and 2012, respectively, related to the 2010 plan. At December 31, 2013 there were 28,740 shares available for grant. The options granted have maximum contractual terms of 10 years.

Service Period Stock Options – A summary of service period stock options outstanding and changes under the plans during the year ended December 31, 2013 is presented below:

Options	Shares			Weighted Average Exercise Price		Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2011		1,468,419		$	5.04
Granted		12,668			5.25
Exercised		—			—
Forfeited		—			—
Outstanding at December 31, 2012		1,481,087			5.04
Outstanding at January 1, 2013		1,481,087			5.04
Granted		—			—
Exercised		(10,752	)		4.64
Forfeited		(6,382	)		4.97
Outstanding at December 31, 2013		1,463,953			5.11		6.0	$	211,505
Exercisable at December 31, 2013		1,208,094		$	5.01		6.0	$	293,250

F-18

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The total intrinsic value of options exercised during the years ended December 31, 2013 was $6,559. No options were exercised during the year ended December 31, 2012.

A summary of the nonvested service period stock options as of December 31, 2013, and changes during the year ended December 31, 2013, is presented below:

	Number of Options			Weighted- Average Grant- Date Fair Value Per Share
Nonvested as of December 31, 2012		503,607		$	4.42
Vested		(241,366	)		4.39
Forfeited and expired		(6,382	)		4.97
Nonvested as of December 31, 2013		255,859		$	4.45

As of December 31, 2013, there is approximately $1,025,518 of total unrecognized compensation costs related to non-vested service period options, which is expected to be recognized over approximately 3 years.

Performance Based Options – Performance based option vesting is contingent upon the Company achieving certain annual or cumulative revenue goals. A summary of performance-based stock options outstanding and changes under the plans during the year ended December 31, 2013 is presented below:

Options	Shares			Weighted Average Exercise Price		Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2011		858,434		$	5.25
Granted		54,143			5.25
Forfeited		—			—
Outstanding at December 31, 2012		912,577			5.25
Outstanding at December 31, 2012		912,577			5.25
Granted		15,000			5.25
Forfeited		(7,143	)		5.25
Outstanding at December 31, 2013		920,434		$	5.25		8.0	$	—

No performance-based options are exercisable at December 31, 2013 or December 31, 2012.

A summary of the nonvested service period stock options as of December 31, 2013, and changes during the year ended December 31, 2013, is presented below:

	Number of Options			Weighted- Average Grant- Date Fair Value Per Share
Nonvested as of December 31, 2012		912,577		$	5.25
Granted		15,000			5.25
Forfeited and expired		(7,143	)		5.25
Nonvested as of December 31, 2013		920,434		$	5.25

F-19

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

As of December 31, 2013, there is approximately $3,947,906 of total unrecognized compensation costs related to non-vested performance based options, which would be recognized if and when the contingent vesting criteria is met. As of December 31, 2013, the achievement of the vesting criteria is not considered probable.

Exit Event Options – Exit event option vesting is contingent upon the occurrence of an exit event, which results from a Change of Control in the Company or an Initial Public Offering of the Company’s common stock under the Securities Act, as defined in the option grant agreement. A summary of exit event stock options outstanding and changes under the plans during the year ended December 31, 2013 is presented below:

Options	Shares			Weighted Average Exercise Price		Average Remaining Contractual Term		Aggregate Intrinsic Value
Outstanding at December 31, 2011		1,148,174		$	5.25
Granted		32,881			5.25
Forfeited		—			—
Outstanding at December 31, 2012		1,181,055			5.25
Outstanding at December 31, 2012		1,181,055			5.25
Granted		7,000			5.25
Forfeited		(2,381	)		5.25
Outstanding at December 31, 2013		1,185,674		$	5.25		8.0	$	—

A summary of the nonvested service period stock options as of December 31, 2013, and changes during the year ended December 31, 2013, is presented below:

	Number of Options			Weighted- Average Grant- Date Fair Value Per Share
Nonvested as of December 31, 2012		1,181,055		$	5.25
Granted		7,000			5.25
Forfeited and expired		(2,381	)		5.25
Nonvested as of December 31, 2013		1,185,674		$	5.25

As of December 31, 2013, there is approximately $5,123,336 of total unrecognized compensation costs related to non-vested performance based options, which would be recognized if and when the contingent vesting criteria is met. As of December 31, 2013, the achievement of the vesting criteria is not considered probable.

Grant Date Fair Value of Options – The grant date fair value of options (service period options, performance based options and exit event options) granted during the year ended December 31, 2013 was $3.99 per share. The grant date fair value of options granted during the year ended December 31, 2012, ranged from $4.10 per share.

F-20

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The fair value of each option-award is estimated on the date of grant using a Black-Scholes option pricing model that uses the assumptions noted in the following table. Expected volatilities are based on historical volatility of the Company’s common stock. The expected term of options granted is based on the “shortcut method” described in FASB ASC 718, Compensation – Stock Compensation (an expected term based on the midpoint between the vesting date and the end of the contractual term). The risk-free interest rates are based on the U.S. Treasury yield for a period consistent with the expected term of the option in effect at the time of the grant. Assumptions used in the Black-Scholes model were as follows:

	Year Ended December 31,
	2013		2012
Expected volatility		86.0%		91.2%
Average expected term in years		7		7
Risk-free interest rate		1.7%		1.2%
Expected dividend yield		0.0%		0.0%

Note 13 – Net Loss Attributable to Common Stockholders:

Basic net loss per common share is calculated by dividing net loss attributable to common stockholders by the weighted-average number of common share outstanding for the period. Diluted net loss per common share is computed by giving effect to all potentially dilutive securities. Diluted net loss per common share is the same as basic net loss per common share, due to the fact that potentially dilutive securities would have an antidilutive effect as the Company incurred a net loss for the year ended December 31, 2013 and 2012.

The potentially dilutive securities excluded from the determination of diluted loss per share, as their effect is antidilutive, are as follows:

	Year ended December 31,
	2013		2012
Convertible Preferred Series C (on an as-if converted basis)		10,429,224		10,274,209
Service Period Stock Options		1,477,291		1,480,014
Warrants		82,634		82,634
		11,989,149		11,836,857

The computation of net income attributable to common stockholders is as follows:

	Year ended December 31,
	2013			2012
Net loss	$	(21,687,155	)	$	(18,656,498	)
Preferred stock dividends on Series B and Series C		(8,595,504	)		(7,953,448	)
Net loss attributable to common stockholders	$	(30,282,659	)	$	(26,609,946	)

Note 14 – Retirement Plan:

The Company sponsors a safe harbor 401(k) plan covering all employees. All employees are eligible to participate. Active participants in the plan may make contributions of up to 25% of their compensation. Company contributions totaled approximately $196,054 for 2013 and $180,098 for 2012.

F-21

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 15 – Related Party Transactions:

Payments made to a stockholder for distribution services totaled approximately $6,146,245 in 2013 and $4,882,534 in 2012. Payments of approximately $4,658,118 in 2013 and $3,059,658 in 2012 were made to stockholders for the purchase of raw materials. In addition payments of approximately $678,371 in 2013 and $707,686 2012 related to rent and associated utilities and maintenance were also made to a stockholder who is also a landlord of one of our locations.

In connection with the $60,000,000 revolving note payable, certain stockholders are guarantors of the note. That agreement stipulated that the Company will pay each guarantor a contingent fee equal to 10% per annum of the amount that each guarantor has committed to guarantee. See note 6 for further detail.

Note 16 – Concentrations:

Concentration of Credit Risk – The Company maintains its cash balances in financial institutions which are insured by the Federal Deposit Insurance Corporation up to $250,000 each. At times, such balances may be in excess of the FDIC insurance limit.

Major Customers – In 2013, net sales to one of our distributors – which sells directly to three of our customers – accounted for 28% of our net sales. In 2012, that distributor accounted for 20% of our net sales. In 2013 and 2012, net sales to one of our customers accounted for 11% and 14%, respectively.

Major Suppliers – The Company purchased approximately 56% of its raw materials from three vendors in the year ended December 31, 2013 and approximately 58% of its raw materials from three vendors in the year ended December 31, 2012. The Company purchased 76% of its treats finished goods from three other vendors for the year ended December 31, 2012. The Company purchased 67% of its packaging material from three vendors for the year ended December 31, 2013.

For one of its raw material vendors, the Company has a purchase agreement whereby prices are fixed for one year periods. Prices adjust every April, through April 1, 2014. The Company has the option to terminate the agreement at the beginning of any future one year period. The Company believes it could obtain similar pricing from another supplier, but a change could potentially cause production delays and additional costs.

Net Sales By Class of Retail – The following table sets forth net sales by class of retail:

	Twelve months ended December 31,
	2013		2012
Grocery and Mass (1)	$	49,731,873	$	33,985,199
Pet Specialty, Natural, and Other (2)		13,418,903		9,534,262
Net Sales	$	63,150,776	$	43,519,461

(1) Includes club retail class

(2) Other sales represent less than 1% of net sales

F-22

FRESHPET, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 17 – Subsequent Events:

The Company has evaluated subsequent events through April 29, 2014. There were no subsequent events identified, other than the following:

• During March 2014, the Company increased the borrowing availability by an additional $5.0 million on our $15,000,000 revolving note payable. See note 6 for further detail.

• During the months of February and April 2014, the Company has raised approximately $6,600,000 of additional capital through the issuance of Series C Preferred Stock.

Note 18 – Unaudited Quarterly Results:

Unaudited quarterly results for the years ended December 31, 2013 and 2012 were as follows:

	First Quarter			Second Quarter			Third Quarter			Fourth Quarter
2013:
Net sales	$	13,885,185		$	14,846,366		$	16,698,903		$	17,720,322
Loss from operations		(3,147,240	)		(3,205,977	)		(4,182,320	)		(1,845,139	)
Net loss		(4,719,104	)		(5,253,194	)		(6,495,643	)		(5,219,214	)
Net loss attributable to common stockholders		(6,751,248	)		(7,364,129	)		(8,647,369	)		(7,519,913	)
Basic earnings per common share		(0.48	)		(0.53	)		(0.62	)		(0.54	)
Diluted earnings per common share		(0.48	)		(0.53	)		(0.62	)		(0.54	)
2012:
Net sales	$	9,382,537		$	10,536,726		$	11,226,549		$	12,373,649
Loss from operations		(4,104,712	)		(3,517,450	)		(4,671,886	)		(2,453,143	)
Net loss		(4,388,417	)		(4,178,740	)		(6,017,866	)		(4,071,475	)
Net loss attributable to common stockholders		(6,342,042	)		(6,151,618	)		(8,020,532	)		(6,095,754	)
Basic earnings per common share		(0.45	)		(0.44	)		(0.57	)		(0.43	)
Diluted earnings per common share		(0.45	)		(0.44	)		(0.57	)		(0.43	)

F-23

FRESHPET INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	June 30, 2014			June 30, 2014 Pro Forma	December 31, 2013
ASSETS
CURRENT ASSETS:
Cash and equivalents	$	1,923,823		$	$	2,444,754
Accounts receivable, less allowance for doubtful accounts of $508,704 on June 30, 2014 and $243,777 on December 31, 2013		5,371,892				3,497,596
Inventories, net		5,752,833				5,512,225
Deferred offering costs		1,075,111				—
Prepaid expenses and other current assets		214,395				173,786
Total Current Assets		14,338,054				11,628,361
Property, plant and equipment, net		55,419,038				48,764,032
Deposits on equipment		3,675,778				1,183,209
Other assets		1,056,002				1,041,622
Total Assets	$	74,488,872		$	$	62,617,224
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable	$	9,965,909		$	$	6,286,720
Accrued expenses		3,193,252				1,907,481
Total Current Liabilities		13,159,161				8,194,201
OTHER LIABILITIES:
Long-term debt		1,140,004				1,112,312
Notes payable		82,500,000				75,000,000
Accrued fees on debt guarantee		10,785,352				7,140,136
Accrued interest on long term debt		773,080				667,110
Other Liabilities		369,564				369,564
Total Liabilities	$	108,727,161		$	$	92,483,323
COMMITMENTS AND CONTINGENCIES
REDEEMABLE PREFERRED STOCK:
Series B, $.001 par value, 250,000 shares authorized, 112,160 issued and outstanding on June 30, 2014 and December 31, 2013		33,080,581				30,728,450
Series C, $0.001 par value, 15,000,000 shares authorized, 12,485,906 and 11,238,098 issued and outstanding on June 30, 2014 and December 31, 2013, respectively		81,510,032				70,463,489
STOCKHOLDERS’ EQUITY (DEFICIT):
Common stock – voting, $0.001 par value, 54,000,000 shares authorized, 14,035,660 issued and outstanding on June 30, 2014 and December 31, 2013		14,037				14,036
Additional paid-in capital		10,084,722				16,446,560
Accumulated deficit		(158,927,661	)			(147,518,634	)
Total Stockholders’ Deficit		(148,828,902	)			(131,058,038	)
Total Liabilities and Stockholders’ Deficit	$	74,488,872		$	$	62,617,224

The accompanying notes are an integral part to the unaudited consolidated financial statements

F-24

FRESHPET INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

	For The Six Months Ended June 30,
	2014			2013
NET SALES	$	39,736,235		$	28,731,551
COST OF GOODS SOLD		20,370,265			15,234,164
GROSS PROFIT		19,365,970			13,497,387
SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES		24,995,794			19,850,604
LOSS FROM OPERATIONS		(5,629,824	)		(6,353,217	)
OTHER EXPENSES:
Other Expenses		(85,076	)		(29,335	)
Fees on Debt Guarantee		(3,645,216	)		(2,034,411	)
Interest expense		(2,032,910	)		(1,539,573	)
		(5,763,202	)		(3,603,319	)
LOSS BEFORE INCOME TAXES		(11,393,026	)		(9,956,536	)
INCOME TAX EXPENSE		16,000			15,762
NET LOSS		(11,409,026	)		(9,972,298	)
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS		(18,256,717	)		(14,115,377	)
NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS:
BASIC	$	(1.30	)	$	(1.01	)
DILUTED	$	(1.30	)	$	(1.01	)
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING USED IN COMPUTING NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS:
BASIC		14,035,660			14,024,908
DILUTED		14,035,660			14,024,908
PRO FORMA NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS (UNAUDITED):
BASIC	$			$
DILUTED	$			$
PRO FORMA WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING USED IN COMPUTING PRO FORMA NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS (UNAUDITED):
BASIC
DILUTED

The accompanying notes are an integral part to the unaudited consolidated financial statements

F-25

FRESHPET INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For The Six Months Ended June 30,
	2014			2013
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(11,409,026	)	$	(9,972,298	)
Adjustments to reconcile net loss to net cash flows from operating activities:
Provision for losses on accounts receivable		211,565			1,983
(Gain)/loss on disposal of equipment and deposits on equipment		70,710			23,529
Guarantee expense		3,645,216			2,034,411
Share-based compensation		485,852			489,178
Change in reserve for inventory obsolescence		(79,292	)		7,107
Depreciation and amortization		3,124,096			1,912,158
Amortization of loan discount and deferred financing costs		126,047			86,910
Changes in operating assets and liabilities:
Accounts receivable		(2,085,862	)		(597,564	)
Inventories		(161,317	)		(661,507	)
Prepaid expenses and other current assets		(1,115,719	)		10,767
Other assets		(94,067	)		(101,965	)
Accounts payable		1,735,920			807,495
Accrued expenses and accrued interest on long-term debt		1,100,936			1,048,165
Net cash flows used in operating activities		(4,444,941	)		(4,911,631	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisitions of property, plant and equipment, software, and deposits on equipment		(10,361,113	)		(17,703,166	)
Proceeds from sale of equipment		234,127			—
Net cash flows used in investing activities		(10,126,986	)		(17,703,166	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Borrowings on notes payable		7,500,000			22,000,000
Proceeds from issuance of preferred stock – Series C		6,550,996			—
Net cash flows from financing activities		14,050,996			22,000,000
NET CHANGE IN CASH AND EQUIVALENTS		(520,931	)		(614,797	)
CASH AND EQUIVALENTS, BEGINNING OF YEAR		2,444,754			1,633,249
CASH AND EQUIVALENTS, END OF PERIOD	$	1,923,823		$	1,018,452
SUPPLEMENTAL CASH FLOW INFORMATION:
Interest paid	$	1,884,534		$	1,490,282
NON-CASH FINANCING ACTIVITY:
Preferred stock dividend accretion	$	6,847,691		$	4,154,915

The accompanying notes are an integral part to the unaudited consolidated financial statements

F-26

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 – Nature of the Business and Summary of Significant Accounting Policies:

Nature of the Business – Freshpet Inc. (hereafter referred to as “Freshpet” or the “Company”), manufactures and markets natural fresh, refrigerated meals and treats for dogs and cats. The Company’s products are distributed throughout the United States and Canada into major retail classes including Grocery and Mass (which includes club) as well as Pet specialty and Natural retail.

Principles of Consolidation – The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the U.S. (“U.S. GAAP”). The financial statements include the accounts of the Company and its wholly-owned subsidiary, Professor Connor’s Canada Inc. (“PCCI”). All significant intercompany accounts and transactions have been eliminated in consolidation.

Basis of Presentation – The accompanying consolidated balance sheet as of June 30, 2014, statements of operations and comprehensive loss for the six months ended June 30, 2014 and 2013, and statements of cash flows for the six months ended June 30, 2014 and 2013 are unaudited. The interim unaudited financial statements have been prepared on the same basis as the annual audited financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary for the fair statement of the Company’s financial position as of June 30, 2014, the results of its operations for the six months ended June 30, 2014 and 2013, and its cash flows for the six months ended June 30, 2014 and 2013. The financial data and other information disclosed in these notes related to the six months ended June 30, 2014 and 2013 are unaudited. The results for six months ended June 30, 2014 are not necessarily indicative of results to be expected for the year ending December 31, 2014, any other interim periods, or any future year or period.

These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the year ended December 31, 2013, included elsewhere in this Registration Statement.

Estimates and Uncertainties – The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results, as determined at a later date, could differ from those estimates.

Deferred Offering Cost – Deferred offering costs, which primarily consist of direct incremental legal and accounting fees relating to the initial public offering (IPO) of the Company’s common stock are capitalized. The deferred offering costs will be offset against IPO proceeds upon the consummation of the offering. In the event the offering is terminated, deferred offering costs will be expensed.

Fair value of Financial Instruments – Financial Accounting Standards Board (‘‘FASB’’) guidance specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect market assumptions. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement).

F-27

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The three levels of the fair value hierarchy are as follows:

• Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities.

• Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active). Level 2 includes financial instruments that are valued using models or other valuation methodologies.

• Level 3 – Unobservable inputs for the asset or liability. Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.

The carrying amounts reported in the balance sheets for other receivables, accounts payable and accrued expenses approximate their fair value based on the short-term maturity of these instruments.

Pro Forma Balance Sheet and Net Loss Per Share

Note 2: Recently Issued Accounting Standards

In April 2014, the FASB issued ASU 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity,” (“ASU 2014-08”). Under ASU 2014-08, only disposals representing a strategic shift in operations that have a major effect on the Company’s operations and financial results should be presented as discontinued operations. Additionally, ASU 2014-08 requires expanded disclosures about discontinued operations that will provide financial statement users with more information about the assets, liabilities, income, and expenses of discontinued operations. The amendments in ASU 2014-08 are effective for fiscal years, and interim periods within those years, beginning after December 15, 2014. However, ASU 2014-08 should not be applied to a component that is classified as held for sale before the effective date even if the component is disposed of after the effective date. Early adoption is permitted, but only for disposals (or classifications as held for sale) that have not been reported in financial statements previously issued. The effects of ASU 2014-08 will depend on any future disposals by the Company.

On May 28, 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. The new standard is effective for the Company on January 1, 2017. Early application is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

F-28

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 3 – Inventories:

Inventories are summarized as follows:

	June 30, 2014			December 31, 2013
Raw materials	$	1,808,831		$	1,431,422
Packaging components material		911,773			805,424
Finished goods		3,137,265			3,459,707
		5,857,869			5,696,553
Reserve for obsolescence		(105,036	)		(184,328	)
	$	5,752,833		$	5,512,225

Note 4 – Property, Plant and Equipment:

Property, plant and equipment, net are summarized as follows:

	June 30, 2014			December 31, 2013
Refrigeration equipment	$	43,999,618		$	35,649,423
Machinery and equipment		19,432,097			20,767,207
Building and improvements		9,932,106			9,892,291
Furniture and office equipment		1,780,216			1,727,248
Leasehold improvements		613,705			1,474,741
Construction in progress		985,360			143,274
Automotive equipment		314,885			313,930
		77,057,987			69,968,114
Less: Accumulated depreciation and amortization		(21,638,949	)		(21,204,082	)
	$	55,419,038		$	48,764,032

Depreciation expense related to property, plant and equipment totaled $3,098,094 for the six months ended June 30, 2014; of which $1,231,484 was recorded to cost of goods sold for the six months ended June 30, 2014, with the remainder of depreciation and amortization expense recorded to selling, general and administrative expense. Depreciation expense related to property, plant and equipment totaled approximately $1,904,080 for six months ended June 30, 2013; of which $359,619 was recorded to cost of goods sold for the six months ended June 30, 2013, with the remainder of depreciation and amortization expense recorded to selling, general and administrative expense.

During the three months ended March 31, 2014, the Company completed a project to analyze the estimated future years of service on its existing refrigeration equipment. Based on this analysis, the Company estimates that the useful life of its refrigeration equipment is 9 years. The Company will apply this change in estimate prospectively, which will reduce by approximately $1.8 million and $2.0 million for the full year 2014 and 2015, respectively. The useful life over the other classes of property, plant and equipment remain unchanged.

F-29

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 5 – Accrued Expenses:

Accrued expenses are summarized as follows:

	June 30, 2014		December 31, 2013
Accrued payroll and bonuses	$	1,129,527	$	1,131,880
Accrued interest		349,470		307,064
Accrued Maintenance		492,959		43,037
Accrued Freight		44,998		166,472
Other accrued expenses		485,508		259,028
Accrued Initial Public Offering Cost		400,000		—
Accrued Equipment		290,790		—
	$	3,193,252	$	1,907,481

Note 6 – Debt

Our total debt outstanding consisted of the amounts set forth on the following table:

	June 30, 2014		December 31, 2013
$1,500,000 10% Note	$	1,140,004	$	1,112,312
$20,000,000 Revolving Note Payable		20,000,000		15,000,000
$62,500,000 Revolving Note Payable		62,500,000		60,000,000
	$	83,640,004	$	76,112,312

a. $1,500,000 10% Note

Consists of $1,500,000 of notes issued to stockholders which accrue interest compounded annually at a rate of 10%. These notes and all accrued interest are due on December 23, 2020.

In connection with the issuance of these notes in February 2010, for every $16.39 that was borrowed with the notes, 1 share of common stock was issued to the lender. As a result, 91,528 shares of common stock were issued and fair value of the stock at issuance, $6.56 a share, was recorded as a discount to the debt. The unamortized discount equaled $359,996 and $387,688 at June 30, 2014 and December 31, 2013, respectively. The amortization expense of $27,692 for the six months ended June 30, 2014, is recorded within interest expense in the statement of operations and comprehensive loss. The accrued interest totaled $773,080 and $667,110 at June 30, 2014 and December 31, 2013, respectively.

b. $20,000,000 Revolving Note Payable

The $20,000,000 revolving note payable matures on October 31, 2015. The borrowings bear interest at either a LIBOR Rate plus 8% margin or a Base Rate plus 6%, depending on the election of the Company. Base Rate is defined as the rate of interest publicly quoted by The Wall Street Journal as the “base rate on corporate loans posted by at least 75% of the nation’s 30 largest banks.” If the Company elects to utilize the LIBOR Rate, it then elects to use a 1, 2, or 3 month LIBOR Rate with the

F-30

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

interest payable upon the last day of the interest period applicable to the Company’s LIBOR rate election. Interest for the Base Rate loan is payable monthly with the balance of any outstanding advances due at maturity. An unused line of credit fee of 1%, payable monthly, is charged for any portion of the line that is not used, unless at least $3 million is kept on deposit with the bank. The Company has not kept a $3 million deposit with the bank.

The loan is collateralized by substantially all of the Company’s assets. The loan agreement provides for the maintenance of various financial covenants. The Company is currently in compliance with these requirements. Borrowings on this revolving note payable totaled $20,000,000 at June 30, 2014 and $15,000,000 at December 31, 2013, as this revolving note payable was amended in March 2014 to increase the borrowing availability to $20,000,000. The recorded carrying values of our debt balances approximate fair value given our debt is at variable rates tied to market indicators.

c. $62,500,000 Revolving Note Payable

The Company entered into a $62,500,000 revolving line of credit agreement with a maturity date of May 1, 2016. Subject to certain conditions, the maturity date may be extended until May 1, 2017 upon delivery of legal opinions stating that the majority stockholder has the right to call capital up through May 1, 2017. The borrowings bear interest at either a LIBOR Rate (LIBOR Adjusted Rate, plus 3.25%) or a Base Rate (Base Rate plus 2.25%). Base rate is defined as the greater of the Prime Rate on the date of the borrowing and the Federal Funds Effective Rate plus 0.5%. Interest on Base Rate Loans are payable monthly, LIBOR Rate loans are payable at the end of the selected interest rate. This revolving note payable is subordinated to the $20,000,000 note payable except for the first mortgage on the Bethlehem, PA property. The loan agreement provides for the maintenance of certain financial covenants. The Company is currently in compliance with these requirements. Borrowings on this revolving note payable totaled $62,500,000 at June 30, 2014 and $60,000,000 at December 31, 2013.

In connection with this note, the Company entered into a Fee and Reimbursement Agreement with certain stockholders who were also guarantors of the note. See note 8 for further detail.

Note 7 – Redeemable Preferred Stock:

The redeemable preferred stock at June 30, 2014 consists of the following:

Series	Shares Authorized		Shares Issued and Outstanding		Proceeds, Net of Issuance Costs
Preferred Series B		250,000		112,160	$	11,159,992
Preferred Series C		15,000,000		12,485,906		64,341,559
		15,250,000		12,598,066	$	75,501,551

The Company issued an additional 1,247,808 shares of Preferred Stock Series C at $5.25 a share during the six months ended June 30, 2014.

The dividends accrued during the six months ended June 30, 2014 and 2013 for the Preferred Stock Series B was $2,352,131 and $2,024,506. The total cumulative dividends as of June 30, 2014 were $21,920,589.

F-31

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The dividend accrued during the six months ended June 30, 2014 and 2013 for the Preferred Stock Series C was $4,495,559 and $2,118,573, respectively. The total cumulative dividends as of June 30, 2014 were $17,168,473.

Note 8 – Guarantee Agreement:

In connection with the $62,500,000 revolving note payable (see Note 6), the Company entered into a Fee and Reimbursement Agreement with certain stockholders who were also guarantors of the note. That agreement stipulated that the Company will pay each guarantor a contingent fee equal to 10% per annum of the amount that each guarantor has committed to guarantee. The payment will be made in the form of newly issued shares of Series C Preferred Stock at the price of $5.25 per share. The fee accrues only from and after the date that that the Guarantor enters into the Guarantee, and if at any time any Guarantor’s obligation is terminated in full or in part, the Fee shall continue to accrue only with respect to the amount, if any of such Guarantor’s remaining commitment under the Credit Agreement. The fee is contingent in that it will become due and payable only if all principal and interest under the credit agreement has been repaid and a Change of Control has occurred. A Change of Control is defined as any sale, merger, consolidation, share exchange, business combination, equity issuance, or other transaction or series of related transactions, specifically excluding public offerings, which result in the stockholders immediately prior to the transaction(s) owning collectively less than 50% of the voting control immediately following the transaction(s); or (ii) any sale, lease, exchange, transfer, or other disposition of substantially all of the assets, taken as a whole, in a single transaction or series of transactions, excluding sales in the ordinary course of business, sale/leaseback and corporate restructuring transactions.

The Guarantee is a financial instrument recognized as a liability by the Company and recorded at fair value at issuance. The instrument is adjusted to its then fair value at each reporting period with changes in fair value recorded in the consolidated statement of operations and comprehensive loss. As of June 30, 2014, the Company measured the fair value of the outstanding guarantee fee using an option pricing method with several possible distribution outcomes depending on the timing and kind of liquidity event. Expected volatility is estimated utilizing the historical volatility of similar companies. The risk-free interest rates are based on the U.S. Treasury yield for a period consistent with the expected contractual life. The following assumptions were utilized:

	June 30, 2014		December 31, 2013
Expected volatility		25.4%		17.0%
Remaining contractual life (in years)		1.0		1.5
Risk-free interest rate		0.11%		0.20%
Expected dividend yield		0.0%		0.0%

The Company categorized the guarantee fee as a Level 3 financial liability since there is no market activity for the underlying Preferred C Stock.

F-32

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial liabilities:

Balance at December 31, 2013		7,140,136
Adjustment to fair value		3,645,216
Balance at June 30, 2014	$	10,785,352

Note 9 – Equity Incentive Plans:

2006 Stock Plan – In December 2006, the Company approved the 2006 Stock Plan (the “2006 Plan”) under which options to purchase approximately 844,000 shares of the Company’s common stock were granted to employees and affiliates of the Company. These options vest over 5 years and approximately $22,788 was recorded as an expense for the six months ended June 30, 2014. Approximately $29,314 was recorded as an expense for the six months ended June 30, 2013. Certain option awards provide for accelerated vesting if there is a change in control (as defined in the 2006 Plan).

2010 Stock Plan – In December 2010, the Company approved the 2010 Stock Plan (the “2010 Plan”) under which options to purchase approximately 2,902,000 shares of the Company’s common stock were granted to employees and affiliates of the Company (in 2012, the 2010 Plan was amended to allow for option to purchase approximately 3,002,000 shares of the Company’s common stock). These options are either time-based (vest over 4 years), performance-based (vest when performance targets are met, as defined in the stock option grant agreement), or vest at the occurrence of an exit event which is defined as a Change of Control in the Company (as defined in the stock option grant agreement) or an initial public offering registered under the Securities Act, as defined under the option grant agreement. Approximately $463,064 was recorded as an expense for the six months ended June 30, 2014. Approximately $459,864 was recorded as an expense for the six months ended June 30, 2013.

During the six months ended June 30, 2014 there were no grants or exercises of Service Based Options, Performance Based Options, and Exit Event Options plans.

Note 10 – Net Loss Attributable to Common Stockholders:

Basic net loss per common share is calculated by dividing net loss attributable to common stockholders by the weighted-average number of common share outstanding for the period. Diluted net loss per common share is computed by giving effect to all potentially dilutive securities. Diluted net loss per common share is the same as basic net loss per common share, due to the fact that potentially dilutive securities would have an antidilutive effect as the Company incurred a net loss for the three and six months ended June 30, 2014 and June 30, 2013.

F-33

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The potentially dilutive securities excluded from the determination of diluted loss per share, as their effect is antidilutive, are as follows:

	Six months ended June 30,
	2014		2013
Convertible Preferred Series C (on an as-if converted basis)		11,942,204		10,285,715
Service Period Stock Options		1,463,533		1,480,954
Warrants		82,634		82,634
		13,488,371		11,849,303

The computation of net income attributable to common stockholders is as follows:

	Six months ended June 30,
	2014			2013
Net loss	$	(11,409,026	)	$	(9,972,298	)
Preferred stock dividends on Series B and Series C		(6,847,691	)		(4,143,079	)
Net loss attributable to common stockholders	$	(18,256,717	)	$	(14,115,377	)

Note 11 – Related Party Transactions:

Payments made to a stockholder for distribution services totaled $4,075,684 during the six months ended June 30, 2014, and $2,934,980 for the six months ended June 30, 2013. Payments of $2,480,467 for the six months ended June 30, 2014, and $2,176,341 for the six months ended June 30, 2013 were made to stockholders for the purchase of raw materials. In addition there were payments of $143,630 for the six months ended June 30, 2014, and $434,515 for the six months ended June 30, 2013 related to rent and associated utilities and maintenance to a stockholder who is also a landlord of one of our locations. The rent and associated utilities and maintenance cost were at market rates. None of the payments made above were to stockholders who are either employee, board member, subsidiary, or affiliate of the Company.

In connection with the $62,500,000 revolving note payable, certain stockholders are guarantors of the note. That agreement stipulated that the Company will pay each guarantor a contingent fee equal to 10% per annum of the amount that each guarantor has committed to guarantee. See Note 8 for further detail.

Note 12 – Concentrations:

Concentration of Credit Risk – The Company maintains its cash balances in financial institutions which are insured by the Federal Deposit Insurance Corporation up to $250,000 each. At times, such balances may be in excess of the FDIC insurance limit.

Major Customers – For the six months ended June 30, 2014, net sales to one of our distributors – which sells directly to three of our customers – accounted for 23% of our net sales. For the six months ended June 30, 2013, that distributor accounted for 25% of our net sales. For the six months ended June 30, 2014, no customer accounted for more than 10% of our net sales while for the same period in 2013 one customer accounted for 12% of our net sales.

F-34

FRESHPET INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Major Suppliers – The Company purchased approximately 53% of its raw materials from three vendors during the six months ended June 30, 2014, and approximately 58% of its raw materials from three vendors in the six months ended June 30, 2013.

The Company also purchased approximately 78% of its treats finished goods from two other vendors for the six months ended June 30, 2014, and approximately 66% from three vendors for the six months ended June 30, 2013.

The Company purchased approximately 68% of its packaging material from two vendors for the six months ended June 30, 2014, and 45% of its packaging material from two vendors for the six months ended June 30, 2013, respectively.

For one of its raw material vendors, the Company has a purchase agreement whereby prices are fixed for one year periods. Prices adjust every April 1. The Company has the option to terminate the agreement at the beginning of any future one year period. The Company believes it could obtain similar pricing from another supplier, but a change could potentially cause production delays and additional costs.

Net Sales By Class of Retail – The following table sets forth net sales by class of retail:

	Six months ended June 30,
	2014		2013
Grocery and Mass (1)	$	29,851,193	$	22,474,475
Pet Specialty, Natural and Other (2)		9,885,042		6,257,076
Net Sales	$	39,736,235	$	28,731,551

(1) Includes club retail class

(2) Other sales represent less than 1% of net sales

Note 13 – Subsequent Events:

The Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued. Based upon the evaluation, the Company did not identify any recognized or unrecognized subsequent events that have required adjustment or disclosure in the financial statements.

F-35

             Shares

Freshpet, Inc.

Common Stock

Goldman, Sachs & Co.

Credit Suisse

Baird

Stifel

SunTrust Robinson Humphrey

Canaccord Genuity

Through and including                     , 2014 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

PART II—INFORMATION NOT REQUIRED IN PROSPECTUS

Item 13. Other Expenses of Issuance and Distribution.

The following table sets forth all costs and expenses, other than the underwriting discounts payable by us, in connection with the offer and sale of the common stock being registered. All amounts shown are estimates except for the Securities and Exchange Commission (“SEC”) registration fee and the Financial Industry Regulatory Authority, Inc. (“FINRA”) filing fee.

	Amount
SEC registration fee	$	*
FINRA filing fee		*
Listing fee		*
Printing expenses		*
Accounting fees and expenses		*
Legal fees and expenses		*
Blue Sky fees and expenses		*
Transfer Agent and Registrar fees and expenses		*
Miscellaneous expenses		*
Total	$	*

* To be provided by amendment.

Item 14. Indemnification of Officers and Directors.

Section 102(b)(7) of the DGCL allows a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except where the director breached the duty of loyalty, failed to act in good faith, engaged in intentional misconduct or knowingly violated a law, authorized the payment of a dividend or approved a stock repurchase in violation of Delaware corporate law or obtained an improper personal benefit. Our Certificate of Incorporation will provide for this limitation of liability.

Section 145 of the DGCL (“Section 145”), provides that a Delaware corporation may indemnify any person who was, is or is threatened to be made, party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of such corporation), by reason of the fact that such person is or was an officer, director, employee or agent of such corporation or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. The indemnity may include expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding, provided such person acted in good faith and in a manner he reasonably believed to be in or not opposed to the corporation’s best interests and, with respect to any criminal action or proceeding, had no reasonable cause to believe that his or her conduct was illegal. Where an officer or director is successful on the merits or otherwise in the defense of any action referred to above, the corporation must indemnify him against the expenses which such officer or director has actually and reasonably incurred.

Section 145 further authorizes a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or enterprise, against any liability asserted against him and incurred by him in any such capacity, or arising out of his or her status as such, whether or not the corporation would otherwise have the power to indemnify him under Section 145.

II-1

Our Certificate of Incorporation will provide that we must indemnify our directors and officers to the fullest extent authorized by the DGCL and must also pay expenses incurred in defending any such proceeding in advance of its final disposition upon delivery of an undertaking, by or on behalf of an indemnified person, to repay all amounts so advanced if it should be determined ultimately that such person is not entitled to be indemnified under this section or otherwise.

We intend to enter into indemnification agreements with each of our current directors and officers. These agreements will require us to indemnify these individuals to the fullest extent permitted under Delaware law against liabilities that may arise by reason of their service to us, and to advance expenses incurred as a result of any proceeding against them as to which they could be indemnified.

The indemnification rights set forth above shall not be exclusive of any other right which an indemnified person may have or hereafter acquire under any statute, provision of our Certificate of Incorporation, our Bylaws, agreement, vote of stockholders or disinterested directors or otherwise.

We maintain standard policies of insurance that provide coverage (1) to our directors and officers against loss rising from claims made by reason of breach of duty or other wrongful act and (2) to us with respect to indemnification payments that we may make to such directors and officers.

The proposed form of underwriting agreement to be filed as Exhibit 1.1 to this Registration Statement provides for indemnification to our directors and officers by the underwriters against certain liabilities.

Item 15. Recent Sales of Unregistered Securities

We sold 3,343,047 shares of Series C Preferred Stock to existing stockholders in the time period since January 1, 2011 in exchange for an aggregate of $17,550,974. In the time period since January 1, 2011, we issued to directors, officers, employees and contractors options to purchase an aggregate of 2,958,003 shares of common stock with exercise prices of $5.25 per share pursuant to the 2010 Plan. In the time period since January 1, 2011, upon the exercise of stock options, we have issued 10,752 shares of common stock to certain officers, directors, employees and contractors in exchange for an aggregate of $49,889. No underwriters were used in connection with the transactions. The sale of such securities was exempt from registration pursuant to Section 4(a)(2) of the Securities Act as transactions by an issuer not involving a public offering and/or Rule 506 promulgated under the Securities Act. All of the purchasers in these transactions represented to us in connection with their purchase that they were acquiring the shares for investment and not distribution, and that they could bear the risks of the investment and could hold the securities for an indefinite period of time. Such purchasers received written disclosures that the securities had not been registered under the Securities Act and that any resale must be made pursuant to a registration or an available exemption from such registration. All of the foregoing securities are deemed restricted securities for the purposes of the Securities Act.

Item 16. Exhibits

(1) Exhibits:

The exhibit index attached hereto is incorporated herein by reference.

(2) Financial Statement Schedules:

No financial statement schedules are provided because the information called for is not required or is shown in the financial statements or the notes thereto.

II-2

Item 17. Undertakings

(a) The undersigned registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreements certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

(b) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

(c) The undersigned Registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be a part of this registration statement as of the time it was declared effective.

(2) For purposes of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

II-3

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Secaucus, State of New Jersey, on September 12, 2014.

FRESHPET, INC.
By:	/s/    Richard Kassar
	Name: Richard Kassar Title: Chief Financial Officer

*  *  *  *

POWER OF ATTORNEY

Each person whose signature appears below constitutes and appoints Richard Kassar his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all (i) amendments (including post-effective amendments) and additions to this registration statement and (ii) any and all additional registration statements pursuant to Rule 462(b) of the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent full power and authority to do and perform each and every act in person, hereby ratifying and confirming all that said attorney-in-fact and agent or his substitute may lawfully do or cause to be done by virtue hereof.

Signature	Title	Date
/s/    Richard Thompson Richard Thompson	Chief Executive Officer and Director (Principal Executive Officer)	September 12, 2014
/s/    Richard Kassar Richard Kassar	Chief Financial Officer and Director (Principal Accounting and Financial Officer)	September 12, 2014
/s/    Charles A. Norris Charles A. Norris	Director	September 12, 2014
/s/    J. David Basto J. David Basto	Director	September 12, 2014
/s/    Jonathan S. Marlow Jonathan S. Marlow	Director	September 12, 2014
/s/    Christopher Harned Christopher Harned	Director	September 12, 2014
/s/    Daryl Brewster Daryl Brewster	Director	September 12, 2014

II-4

Signature	Title	Date
/s/    Brian McInerney Brian McInerney	Director	September 12, 2014
/s/    Steven Gilbert Steven Gilbert	Director	September 12, 2014
/s/    Scott Morris Scott Morris	Director	September 12, 2014

II-5

EXHIBIT INDEX

Exhibit No.	Description
1.1*	Form of Underwriting Agreement
3.1	Second Amended and Restated Certificate of Incorporation
3.2	Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation
3.3	Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation
3.4	Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation
3.5	Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation
3.6	Bylaws
4.1	Warrant Agreement, dated as of October 5, 2007, between the Company and City National Bank, a national banking association
5.1*	Opinion of Kirkland & Ellis LLP
10.1	Amended and Restated Credit Agreement, dated as of April 12, 2013, among the Company, the several banks and other lenders from time to time parties to thereto and OneWest Bank, FSB, as administrative agent for the lenders
10.2	First Amendment to Amended and Restated Credit Agreement, dated as of May 7, 2013, among the Company, the several banks and other lenders from time to time parties thereto and OneWest Bank, FSB, as administrative agent for the lenders
10.3	Second Amendment to Amended and Restated Credit Agreement, dated as of July 2, 2013, among the Company, the several banks and other lenders from time to time parties thereto and OneWest Bank, FSB, as administrative agent for the lenders
10.4	Third Amendment to Amended and Restated Credit Agreement, dated as of September 30, 2013, among the Company, the several banks and other lenders from time to time parties thereto and OneWest Bank, FSB, as administrative agent for the lenders
10.5	Amended and Restated Loan and Security Agreement, dated as of December 23, 2010, by and between the Company and City National Bank, a national banking association, as lender
10.6	Amendment Number One to Amended and Restated Loan and Security Agreement, dated as of February 9, 2012, by and between the Company and City National Bank, a national banking association, as lender
10.7	Amendment Number Two to Amended and Restated Loan and Security Agreement, dated as of May 2, 2012, by and between the Company and City National Bank, a national banking association, as lender
10.8	Amendment Number Three to Amended and Restated Loan and Security Agreement, dated as of June 8, 2012, by and between the Company and City National Bank, a national banking association, as lender
10.9	Amendment Number Four to Amended and Restated Loan and Security Agreement, dated as of May 3, 2013, by and between the Company and City National Bank, a national banking association, as lender
10.10	Amendment Number Five to Amended and Restated Loan and Security Agreement, dated as of March 14, 2014, by and between the Company and City National Bank, a national banking association, as lender
10.11	Amendment Number Six to Amended and Restated Loan and Security Agreement, dated as of September 4, 2014, by and between the Company and City National Bank, a national banking association, as lender
10.12*	Form of Freshpet, Inc. 2014 Omnibus Incentive Plan

II-6

Exhibit No.	Description
10.13*	Form of Restricted Stock Agreement Pursuant to the Freshpet, Inc. 2014 Omnibus Incentive Plan
10.14*	Form of Restricted Stock Unit Agreement Pursuant to the Freshpet, Inc. 2014 Omnibus Incentive Plan
10.15*	Form of Director Restricted Stock Unit Agreement Pursuant to the Freshpet, Inc. 2014 Omnibus Incentive Plan
10.16*	Form of Nonqualified Stock Option Agreement Pursuant to the Freshpet, Inc. 2014 Omnibus Incentive Plan
10.17*	Form of Stock Appreciation Rights Agreement Pursuant to the Freshpet, Inc. 2014 Omnibus Incentive Plan
10.18*	Form of Freshpet, Inc. Non-Employee Director Compensation Policy
10.19	Employment Agreement between Richard Thompson and Freshpet, Inc., dated as of December 23, 2010
10.20	Employment Agreement between Scott Morris and Freshpet, Inc. dated as of October 25, 2006
10.21	Amendment to Employment Agreement between Scott Morris and Freshpet, Inc. dated as of January 6, 2009
10.22	Employment Agreement between Cathal Walsh and Freshpet, Inc. dated as of October 25, 2006
10.23	Amendment to Employment Agreement between Cathal Walsh and Freshpet, Inc. dated as of January 6, 2009
10.24*	Form of Indemnification Agreement between Freshpet, Inc. and each of its directors and executive officers
10.25*	Form of Freshpet, Inc. Stockholders Agreement
10.26*	Form of Registration Rights Agreement
10.27	Amended and Restated Fee and Reimbursement Agreement among Freshpet, Inc. and the other parties thereto dated as of April 15, 2013
10.28	Amendment No. 1 to the Amended and Restated Fee and Reimbursement Agreement among Freshpet, Inc. and the other parties thereto dated as of October 9, 2013
10.29	Amendment No. 2 to the Amended and Restated Fee and Reimbursement Agreement among Freshpet, Inc. and the other parties thereto dated as of April 7, 2014
10.30*	Distribution Agreement between Tyson Foods, Inc. and Freshpet, Inc. dated as of January 6, 2009
10.31*	Amendment to the Distribution Agreement between Tyson Foods, Inc. and Freshpet, Inc. dated as of August 8, 2014
10.32*	$1.5 Million Stockholder Note
21.1	List of Subsidiaries
23.1	Consent of KPMG LLP
23.2*	Consent of Kirkland & Ellis LLP (included in Exhibit 5.1)
24.1	Power of Attorney (included on the signature page of this Registration Statement)

* To be filed by amendment.

II-7

EX-3.1

Exhibit 3.1

State of Delaware

Secretary of State

Division of Corporations

Delivered 03:46 PM 12/23/2010

FILED 03:40 PM 12/23/2010

SRV 101230713 - 3880284 FILE

SECOND AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF

PROFESSOR CONNOR’S, INC.

(Pursuant to Sections 242 and 245 of the

General Corporation Law of the State of Delaware)

Professor Connor’s, Inc. (the “Corporation”), a corporation organized and existing under and by virtue of the provisions of the General Corporation Law of the State of Delaware (the “General Corporation Law”),

DOES HEREBY CERTIFY:

1. That the name of this corporation is Professor Connor’s, Inc., and that this Corporation was originally incorporated pursuant to the General Corporation Law on November 12, 2004 under the name Professor Connor’s, Inc.

2. That the Board of Directors duly adopted resolutions proposing to amend and restate the Certificate of Incorporation of this Corporation, declaring said amendment and restatement to be advisable and in the best interests of this Corporation and its stockholders, and authorizing the appropriate officers of this Corporation to solicit the consent of the stockholders therefor, which resolution setting forth the proposed amendment and restatement is as follows:

RESOLVED, that the Certificate of Incorporation of this Corporation be amended and restated in its entirety to read as follows:

FIRST: The name of this Corporation is Professor Connor’s, Inc. (the “Corporation”)

SECOND: The address of the registered office of the Corporation in the State of Delaware is 3500 South Dupont Highway in the City of Dover, County of Kent. The name of its registered agent at such address is Incorporating Services, Ltd.

THIRD: The nature of the business or purposes to be conducted or promoted is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law.

FOURTH: The total number of shares of capital stock of all classes that the Corporation shall have the authority to issue is Forty-Six Million Two Hundred Fifty Thousand (46,250,000) shares. The authorized capital stock is divided into (i) Thirteen Million Seven Hundred Fifty Thousand (13,750,000) shares of preferred stock, with par value of $0.001 per share (the “Preferred Stock”); and (ii) Thirty-Two Million Five Hundred Thousand (32,500,000) shares of common stock (the “Common Stock”), with par value of $0.001 per share.

The following is a statement of the designations and the powers, privileges and rights, and the qualifications, limitations or restrictions thereof in respect of each class of capital stock of the Corporation.

A. COMMON STOCK

1. General. The voting, dividend and liquidation rights of the holders of the Common Stock are subject to and qualified by the rights, powers and preferences of the holders of the Preferred Stock set forth herein and as may be designated by resolution of the Board of Directors with respect to any series of Preferred Stock as authorized herein.

2. Voting.

2.1 Common Stock. Each holder of shares of Common Stock shall be entitled to one (1) vote for each share of Common Stock held of record by such holder on all matters, and in such manner, as may be provided by law. Each holder of shares of Common Stock shall be entitled to notice of any stockholders’ meeting in accordance with the by-laws of the Corporation.

B. PREFERRED STOCK

1. Issuance and Reissuance.

Preferred Stock may be issued from time to time in one or more series, each of such series to consist of such number of shares and to have such terms, rights, powers and preferences, and the qualifications and limitations with respect thereto, as stated or expressed herein and in the resolution or resolutions providing for the issue of such series adopted by the Board of Directors of the Corporation as hereinafter provided. Any shares of Preferred Stock which may be redeemed, purchased or acquired by the Corporation may be reissued except as otherwise provided by law or by the terms of any series of Preferred Stock.

2. Blank Check Preferred Stock.

Subject to any vote expressly required by the Second Amended and Restated Certificate of Incorporation, authority is hereby expressly granted to the Board of Directors from time to time to issue the Preferred Stock in one or more series, and in connection with the creation of any such series, by resolution or resolutions providing for the issue of the shares thereof, to determine and fix such voting powers, full or limited, or no voting powers, and such designations, preferences and relative participating, optional or other special rights, and qualifications, limitations or restrictions thereof, including, without limitation thereof, dividend rights, special voting rights, conversion rights, redemption privileges and liquidation preferences, as shall be stated and expressed in such resolutions, all to the full extent now or hereafter permitted by the General Corporation Law. Without limiting the generality of the foregoing, and subject to the rights of any series of Preferred Stock then outstanding, the resolutions providing for issuance of any series of Preferred Stock may provide that such series shall be superior or rank equally or be junior to the Preferred Stock of any other series to the extent permitted by law.

C. [RESERVED]

D. SERIES B PREFERRED STOCK

Two Hundred Fifty Thousand (250,000) shares of the authorized and unissued Preferred Stock of the Corporation are hereby designated “Series B Preferred Stock” with the following rights, preferences, powers, privileges and restrictions, qualifications and limitations. Unless otherwise indicated, references to “Sections” in this Part D of this Article Fourth refer to sections of Part D of this Article Fourth.

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1. Dividends.

1.1 Holders of record of shares of Series B Preferred Stock shall be entitled to receive dividends payable in additional fully paid and non-assessable shares of Series B Preferred Stock (x) for the period commencing on the date of first issuance of the Series B Preferred Stock (the “Series B Original Issue Date”) and ending on the last day of the calendar quarter of such issuance (the “Initial Period”), and (y) for each calendar quarter thereafter (each such quarterly period, a “Quarterly Dividend Period”), which Quarterly Dividend Periods shall commence on the first day of January, April, July and October during each calendar year, and shall end on the day prior to the start of the next succeeding calendar quarter, in each case at a rate per annum of 15% of the Series B Original Issue Price (as defined below). All dividends described in this Section 1.1 payable with respect to the Initial Period and any Quarterly Dividend Period shall be payable (and deemed paid regardless of whether share certificates are issued in respect thereof) on the tenth day of the month following the end of the Initial Period and such Quarterly Dividend Period (each such payment date, a “Dividend Payment Date”). Such dividends shall be paid to the holders of record at the close of business on the date specified by the Board of Directors of the Corporation at the time such dividend is declared; provided, however, that such date shall not be more than 60 days nor less than 10 days prior to the relevant Dividend Payment Date. Such dividends shall be fully cumulative during the Initial Period and each Quarterly Dividend Period, but not compounding, and shall accrue (whether or not declared), without interest, from the first day of the Initial Period and each Quarterly Dividend Period to and including the end of the Initial Period and such Quarterly Dividend Period (or, if sooner, the redemption of the applicable shares of Series B Preferred Stock), except that with respect to the dividends for the Initial Period, such dividends shall accrue from the Series B Original Issue Date to and including the end of the Initial Period. Dividends shall accrue on a daily basis without regard to the occurrence of a Dividend Payment Date or the declaration of any dividend.

1.2 Dividends on the Series B Preferred Stock shall be paid by delivering to the record holders of the Series B Preferred Stock a number of additional shares of Series B Preferred Stock determined by dividing the total amount of cash dividends which would be payable on the Series B Preferred Stock on the respective Dividend Payment Date (if dividends on the Series B Preferred Stock were payable in cash) by the Series B Original Issue Price. The Corporation shall not issue fractional shares of Series B Preferred Stock to which the holders may become entitled hereunder, but in lieu thereof, the Corporation shall (subject to contractual and other restrictions in respect thereto and to the legal availability of funds therefor) deliver to each holder its check in an amount equal to the applicable fractional share that otherwise would have been issued to such holder. To the extent the Corporation is not able or permitted (by contractual or legal restrictions, or otherwise) from paying such cash in lieu of fractional shares, such unpaid amounts will be carried forward, without interest, and shall be added to the respective amounts due to holders on the next Dividend Payment Date; provided, however, if the contractual, legal or other restriction which prevented the payment of

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such cash in lieu of fractional shares shall lapse, be removed or otherwise no longer prevent such payment, the Corporation shall make such payment as soon as practicable thereafter.

1.3 Additional shares of Series B Preferred Stock issued from time to time under this Second Amended and Restated Certificate of Incorporation, including shares of Series B Preferred Stock issued as dividends pursuant to Section 1.2, shall be governed in all respects by the terms of this Second Amended and Restated Certificate of Incorporation, except as to the date of issuance and the date from which dividends accrue thereon.

1.4 Dividends payable on the Series B Preferred Stock for any period less than an Annual Dividend Period shall be computed on the basis of a 365-day year and the actual number of days elapsed in such period.

1.5 For purposes hereof, “Series B Original Issue Price” shall mean $100.00 per share of Series B Preferred Stock.

2. Liquidation, Dissolution or Winding Up; Certain Mergers, Consolidations and Asset Sales.

2.1 Payments to Holders of Series B Preferred Stock. In the event of a Liquidation Event (as such term is defined below), the holders of shares of Series B Preferred Stock then outstanding shall be entitled to be paid out of the assets of the Corporation available for distribution, pari passu with the Series C Preferred Stock and before any payment shall be made to the holders of Common Stock or any other class or series of capital stock ranking on liquidation junior to the Series B Preferred Stock by reason of their ownership thereof and the holders of shares of Series C Preferred Stock then outstanding shall be entitled to be paid out of the assets of the Corporation available for distribution, pari passu with the Series B Preferred Stock and before any payment shall be made to the holders of Common Stock or any other class or series of capital stock ranking on liquidation junior to the Series C Preferred Stock by reason of their ownership in the following order:

(i) first, (A) the holders of shares of Series B Preferred Stock then outstanding shall be entitled to be paid, with respect to shares of Series B Preferred Stock outstanding as of the date hereof, an amount per share equal to the Series B Original Issue Price and (B) the holders of shares of Series C Preferred Stock then outstanding shall be entitled to be paid with respect to the shares of Series C Preferred Stock outstanding as of the date hereof, an amount equal to the greater of (x) the per share amount equal to the Series C Original Issue Price or (y) the amount to which the holder of a share of Series C Preferred Stock would be entitled to receive upon such Liquidation Event if such share of Series C Preferred Stock was converted into Common Stock pursuant to Section 4 of Part E of this Article Fourth immediately prior to such event; and

(ii) second (A) the holders of shares of Series B Preferred Stock then outstanding shall be entitled to be paid, with respect to the aggregate number of shares of Series B Preferred Stock received by such holders on each Dividend Payment Date through the date of the

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Liquidation Event, an amount per share equal to the Series B Original Issue Price plus any unpaid cash dividends payable in lieu of fractional shares in accordance with Section 1.2 and (B) the holders of shares of Series C Preferred Stock then outstanding shall be entitled to be paid, an amount in cash equal to any and all accrued but unpaid dividends thereon.

If upon any Liquidation Event, the assets of the Corporation available for distribution to its stockholders shall be insufficient to pay the holders of shares of Series B Preferred Stock and Series C Preferred Stock the full amount to which they shall be entitled under this Section 2.1, the holders of shares of Series B Preferred Stock and Series C Preferred Stock shall share ratably in any distribution of the assets available for distribution in proportion to the respective amounts that would otherwise be payable in respect of the shares held by them upon such distribution if all amounts payable on or with respect to such shares were paid in full. Not less than 10 days prior to the closing of a Liquidation Event, the Corporation shall deliver written notice of any such Liquidation Event to each holder of shares of Series B Preferred Stock and each holder of shares of Series C Preferred Stock.

2.2 Payments to Holders of Common Stock. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, after the payment of all preferential amounts required to be paid to the holders of shares of Series B Preferred Stock and Series C Preferred Stock, the remaining assets of the Corporation available for distribution to its stockholders shall be distributed among the holders of shares of Common Stock, pro rata based on the number of shares held by each such holder.

2.3 Non-Cash Distributions. Whenever a distribution provided for in this Section 2 shall be payable in property other than cash, the value of such distribution shall be deemed to be the fair market value of such property as determined in good faith by the Board of Directors.

2.4 Distributions Made Ratably. Any distributions payable to the holders of the Series B Preferred Stock and Series C Preferred Stock shall be shared ratably among such holders of each series in proportion to number of shares held by them.

2.5 Certain Definitions.

2.5.1 A “Distribution” shall mean (a) the transfer of cash or other property without consideration, whether by way of dividend or otherwise, other than dividends on Common Stock payable in Common Stock, or (b) the purchase or redemption of shares of the Corporation for cash or property.

2.5.2 A “Liquidation Event” shall mean (a) a liquidation, dissolution or winding up of the Corporation at law, whether voluntary or involuntary and (b) each of the following events:

(i) a merger or consolidation in which

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(1) the Corporation is a constituent party or

(2) a subsidiary of the Corporation is a constituent party and the Corporation issues shares of its capital stock pursuant to such merger or consolidation,

except any such merger or consolidation involving the Corporation or a subsidiary in which the shares of capital stock of the Corporation outstanding immediately prior to such merger or consolidation continue to represent, or are converted into or exchanged for shares of capital stock that represent, immediately following such merger or consolidation, at least fifty percent (50%), by voting power, of the capital stock of (1) the surviving or resulting corporation or (2) if the surviving or resulting corporation is a wholly owned subsidiary of another corporation immediately following such merger or consolidation, the parent corporation of such surviving or resulting corporation (provided that, for the purpose of this Section 2.5.2, all shares of Common Stock issuable upon exercise of Options (as defined below) outstanding immediately prior to such merger or consolidation or upon conversion of Convertible Securities (as defined below) outstanding immediately prior to such merger or consolidation shall be deemed to be outstanding immediately prior to such merger or consolidation and, if applicable, converted or exchanged in such merger or consolidation on the same terms as the actual outstanding shares of Common Stock are converted or exchanged); or

(ii) the sale, lease, transfer or other disposition, in a single transaction or series of related transactions, by the Corporation of all or substantially all the assets of the Corporation and its subsidiaries taken as a whole or the sale or disposition (whether by merger or otherwise) of one or more subsidiaries of the Corporation if substantially all of the assets of the Corporation and its subsidiaries taken as a whole are held by such subsidiary or subsidiaries, except where such sale, lease, transfer or other disposition is to a wholly owned subsidiary of the Corporation.

2.5.3 “Options” means rights, options or warrants to subscribe for, purchase or otherwise acquire Common Stock or, including stock options, evidences of indebtedness, shares or other securities directly or indirectly convertible into or exchangeable for Common Stock.

2.6 Amount Deemed Paid or Distributed. The amount deemed paid or distributed to the holders of capital stock of the Corporation upon any such merger, consolidation, sale, transfer other disposition or redemption shall be the cash or the value of the property, rights or securities paid or distributed to such holders by the Corporation or the acquiring person, firm or other entity. The value of such property, rights or securities shall be determined in good faith by the Board of Directors of the Corporation, except that any publicly-traded securities to be distributed to stockholders in respect of a Liquidation Event shall be valued as follows:

2.6.1 If the securities are then traded on a national securities exchange, then the value of the securities shall be deemed to be the average of the closing prices of the securities on such exchange over the ten (10) trading day period ending five (5) trading days prior to the distribution; and

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2.6.2 if the securities are actively traded over-the-counter, then the value of the securities shall be deemed to be the average of the closing bid prices of the securities over the ten (10) trading day period ending five (5) trading days prior to the distribution.

2.6.3 In the event of a merger or other acquisition of the Corporation by another entity, the distribution date shall be deemed to be the date such transaction closes.

2.6.4 For purposes of this Section 2.4, “trading day” shall mean any day which the exchange or system on which the securities to be distributed are traded is open and “closing prices” or “closing bid prices” shall be deemed to be: (i) for securities traded primarily on the New York Stock Exchange, the American Stock Exchange or Nasdaq, the last reported trade price or sale price, as the case may be, at 4:00 p.m., New York time, on that day and (ii) for securities listed or traded on other exchanges, markets and systems, the market price as of the end of the regular hours trading period that is generally accepted as such for such exchange, market or system. If, after the Filing Date, the benchmark times generally accepted in the securities industry for determining the market price of a stock as of a given trading day shall change from those set forth above, the fair market value shall be determined as of such other generally accepted benchmark times. Notwithstanding the foregoing, if the consideration received by the Corporation or the proceeds to be distributed to holders of shares of the Corporation’s capital stock is other than cash and the definitive merger agreement, asset purchase agreement or other definitive transaction document entered into with respect to a transaction or transactions constituting a Liquidation Event specifies an alternative method of determining the value of such consideration or proceeds, then, for the purpose of this Section 2.4, the value of such consideration or proceeds shall be determined in accordance with the method set forth in such merger agreement, asset purchase agreement or other definitive transaction document, as applicable.

3. Voting Rights and Restrictions.

3.1 No Voting Rights. No holder of shares of Series B Preferred Stock shall be entitled to vote any of the shares of Series B Preferred Stock so held, nor shall such holders be entitled to notice of any meeting of the Corporation’s stockholders convened in accordance with the Corporation’s bylaws, except as otherwise required by law.

3.2 Restrictions. Notwithstanding Section 3.1, the Corporation shall not make any Distribution in respect of any shares of Common Stock without the consent of holders of a majority of the Series B Preferred Stock then outstanding other than: (i) repurchases of Common Stock issued to or held by employees, officers, directors or consultants of the Corporation or its subsidiaries upon termination of their employment or services pursuant to agreements providing for the right of said repurchase, (ii) repurchases of Common Stock issued to or held by employees, officers, directors or consultants of the Corporation or its subsidiaries pursuant to rights of first refusal contained in agreements providing for such right.

4. No Conversion or Preemptive Rights. The Series B Preferred Stock shall not be convertible and shall not be entitled to any preemptive rights.

5. [RESERVED]

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6. Redeemed or Otherwise Acquired Shares. Any shares of Series B Preferred Stock which are redeemed or otherwise acquired by the Corporation or any of its subsidiaries pursuant to Section 6 of Part E of this Article Fourth shall be automatically cancelled and retired, and may not be reissued, sold or transferred by the Corporation. Neither the Corporation nor any of its subsidiaries may exercise any voting or other rights granted to the holders of Series B Preferred Stock following redemption.

7. Waiver. Any of the rights, powers, preferences and other terms of the Series B Preferred Stock set forth herein may be waived on behalf of all holders of Series B Preferred Stock by the affirmative written consent or vote of the holders of at least a majority of the shares of Series B Preferred Stock then-outstanding.

8. Notices. Any notice required or permitted by the provisions of this Article Fourth to be given to a holder of shares of Series B Preferred Stock shall be mailed, postage prepaid, to the post office address last shown on the records of the Corporation, or given by electronic communication in compliance with the provisions of the General Corporation Law, and shall be deemed sent upon such mailing or electronic transmission.

E. SERIES C PREFERRED STOCK

13,500,000 shares of the authorized and unissued Preferred Stock of the Corporation are hereby designated “Series C Preferred Stock” with the following rights, preferences, powers, privileges and restrictions, qualifications and limitations. Unless otherwise indicated, references to “Sections” in this Part E of this Article Fourth refer to sections of Part E of this Article Fourth.

1. Dividends.

1.1 Except as otherwise provided herein, from and after the date of issuance of any share of Series C Preferred Stock, dividends at a rate of 8% per annum of the Series C Original Issue Price (as defined below) shall accrue on each share of Series C Preferred Stock (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Series C Preferred Stock) (the “Accruing Dividends”). Accruing Dividends shall accrue from day to day and be cumulative, whether or not declared and whether or not there are profits, surplus or other funds of the Corporation legally available for payment of the Accruing Dividends; provided however, that except as set forth in Section 2 and Section 6, such Accruing Dividends shall be payable only when, as, and if declared by the Board of Directors (the “Series C Dividend Payment Date”). The date on which the Corporation initially issues any share of Series C Preferred Stock shall be deemed to be its “date of issuance” regardless of the number of times transfer of such share of Series C Preferred Stock is made on the stock records maintained by or for the Corporation and regardless of the number of certificates which may be issued to evidence such share of Series C Preferred Stock.

1.2 For purposes hereof, “Series C Original Issue Price” shall mean $5.25 per share of Series C Preferred Stock.

1.3 In addition to any other dividends accruing or declared hereunder, the holders of the then outstanding shares of Series C Preferred Stock shall be entitled to

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share ratably in any cash dividends declared and paid on the Common Stock in an amount per share equal to the amount of the dividend proposed to be paid on a share of Common Stock multiplied by the number of shares of Common Stock issuable upon conversion of the Series C Preferred Stock pursuant to the provisions of Section 4 hereof on the record date for such dividend.

1.4 The Accruing Dividends shall terminate and no longer be payable in respect of any share of Series C Preferred Stock that is converted to Common Stock pursuant to Section 4 or Section 5 hereof.

2. Liquidation, Dissolution or Winding Up; Certain Mergers, Consolidations and Asset Sales. In the event of a Liquidation Event (as defined in Section 2.3.1 of Part C of this Article Fourth), the holders of shares of Series C Preferred Stock then outstanding shall be entitled to be paid out of the assets of the Corporation available for distribution in accordance with Section 2 of Part D of this Article Fourth.

3. Voting Rights. On any matter presented to the stockholders of the Corporation for their action or consideration at any meeting of stockholders of the Corporation (or by written consent of stockholders in lieu of meeting), each holder of outstanding shares of Series C Preferred Stock shall be entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Series C Preferred Stock held by such holder are convertible as of the record date for determining stockholders entitled to vote on such matter. Except as provided by law or by the other provisions of the Second Amended and Restated Certificate of Incorporation, holders of Series C Preferred Stock shall vote together with the holders of Common Stock as a single class. The holders of Series C Preferred Stock shall be entitled to notice of all stockholders’ meetings in accordance with the Corporation’s Bylaws.

4. Optional Conversion.

The holders of the Series C Preferred Stock shall have conversion rights as follows (the “Conversion Rights”):

4.1 Right to Convert.

4.1.1 Conversion Ratio. Each share of Series C Preferred Stock shall be convertible, at the option of the holder thereof, at any time and from time to time, and without the payment of additional consideration by the holder thereof, into such number of fully paid and nonassessable shares of Common Stock as is determined by dividing the Series C Original Issue Price by the Series C Conversion Price (as defined below) in effect at the time of conversion. The “Series C Conversion Price” shall initially be equal to $5.25. Such initial Series C Conversion Price, and the rate at which shares of Series C Preferred Stock may be converted into shares of Common Stock, shall be subject to adjustment as provided below.

4.1.2 Termination of Conversion Rights. The Conversion Rights of any share of Series C Preferred Stock subject to redemption pursuant to Section 6.1 shall terminate on the Series C Holder Redemption Date unless the Corporation has failed to pay to the holder thereof the Series C Redemption Price of such share, in which case the Conversion Rights for such share shall continue until the Series C Redemption Price is paid in full. In the event of a liquidation, dissolution or winding up of the Corporation or a Liquidation Event, the Conversion Rights shall terminate on the payment in full of all such amounts distributable on such event to the holders of Series C Preferred Stock.

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4.2 Fractional Shares. No fractional shares of Common Stock shall be issued upon conversion of the Series C Preferred Stock. In lieu of any fractional shares to which the holder would otherwise be entitled, the Corporation shall pay cash equal to such fraction multiplied by the fair market value of a share of Common Stock as determined in good faith by the Board of Directors of the Corporation. Whether or not fractional shares would be issuable upon such conversion shall be determined on the basis of the total number of shares of Series C Preferred Stock the holder is at the time converting into Common Stock and the aggregate number of shares of Common Stock issuable upon such conversion.

4.3 Mechanics of Conversion.

4.3.1 Notice of Conversion. In order for a holder of Series C Preferred Stock to voluntarily convert shares of Series C Preferred Stock into shares of Common Stock, such holder shall surrender the certificate or certificates for such shares of Series C Preferred Stock (or, if such registered holder alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably acceptable to the Corporation to indemnify the Corporation against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate), at the office of the transfer agent for the Series C Preferred Stock (or at the principal office of the Corporation if the Corporation serves as its own transfer agent), together with written notice that such holder elects to convert all or any number of the shares of the Series C Preferred Stock represented by such certificate or certificates and, if applicable, any event on which such conversion is contingent. Such notice shall state such holder’s name or the names of the nominees in which such holder wishes the certificate or certificates for shares of Common Stock to be issued. If required by the Corporation, certificates surrendered for conversion shall be endorsed or accompanied by a written instrument or instruments of transfer, in form satisfactory to the Corporation, duly executed by the registered holder or his, her or its attorney duly authorized in writing. The close of business on the date of receipt by the transfer agent (or by the Corporation if the Corporation serves as its own transfer agent) of such certificates (or lost certificate affidavit and agreement) and notice shall be the time of conversion (the “Conversion Time”), and the shares of Common Stock issuable upon conversion of the shares represented by such certificate shall be deemed to be outstanding of record as of such date. The Corporation shall, as soon as practicable after the Conversion Time (but in any event within three business days), (i) issue and deliver to such holder of Series C Preferred Stock, or to his, her or its nominees, a certificate or certificates for the number of full shares of Common Stock issuable upon such conversion in accordance with the provisions hereof and a certificate for the number (if any) of the shares of Series C Preferred Stock represented by the surrendered certificate that were not converted into Common Stock and (ii) pay in cash such amount as provided in Subsection 4.2 in lieu of any fraction of a share of Common Stock otherwise issuable upon such conversion.

4.3.2 Reservation of Shares. The Corporation shall at all times when the Series C Preferred Stock shall be outstanding, reserve and keep available out of its authorized but unissued capital stock, for the purpose of effecting the conversion of the Series C Preferred Stock, such number of its duly authorized shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding Series C Preferred Stock; and if at any time

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the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of the Series C Preferred Stock, the Corporation shall take such corporate action as may be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes, including, without limitation, engaging in best efforts to obtain the requisite stockholder approval of any necessary amendment to the Second Amended and Restated Certificate of Incorporation. All shares of Common Stock which are so issuable shall, when issued, be duly and validly issued, fully paid and nonassessable and free from all taxes, liens, charges and encumbrances. The Corporation shall take all such actions as may be necessary to assure that all such shares of Common Stock may be so issued without violation of any applicable law or governmental regulation or any requirements of any domestic securities exchange upon which the shares of such Common Stock may be listed (except for official notice of issuance which shall be immediately delivered by the Corporation upon each such issuance). The Corporation shall not take any action which would cause the number of authorized shares of Common Stock to be less than the number of such shares required to be reserved hereunder for issuance upon conversion of the Series C Preferred Stock. In connection With Subsection 4.4, before taking any action which would cause an adjustment reducing the Series C Conversion Price below the then par value of the shares of Common Stock issuable upon conversion of the Series C Preferred Stock, the Corporation will take any corporate action which may, in the opinion of its counsel, be necessary in order that the Corporation may validly and legally issue fully paid and nonassessable shares of Common Stock at such adjusted Series C Conversion Price.

4.3.3 Effect of Conversion. All shares of Series C Preferred Stock which shall have been surrendered for conversion as herein provided shall no longer be deemed to be outstanding and all rights with respect to such shares shall immediately cease and terminate at the Conversion Time, except only the right of the holders thereof to receive shares of Common Stock in exchange therefore and to receive payment in lieu of any fraction of a share otherwise issuable upon such conversion as provided in Subsection 4.2. Any shares of Series C Preferred Stock so converted shall be retired and cancelled and may not be reissued as shares of such series, and the Corporation may thereafter take such appropriate action (without the need for stockholder action) as may be necessary to reduce the authorized number of shares of Series C Preferred Stock accordingly.

4.3.4 No Further Adjustment. Upon any such conversion, no adjustment to the Series C Conversion Price shall be made for any declared but unpaid dividends on the Series C Preferred Stock surrendered for conversion or on the Common Stock delivered upon conversion.

4.3.5 Taxes. The Corporation shall pay any and all issue and other similar taxes that may be payable in respect of any issuance or delivery of shares of Common Stock upon conversion of shares of Series C Preferred Stock pursuant to this Section 3. The Corporation shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of shares of Common Stock in a name other than that in which the shares of Series C Preferred Stock so converted were registered, and no such issuance or delivery shall be made unless and until the person or entity requesting such issuance has paid to the Corporation the amount of any such tax or has established, to the satisfaction of the Corporation, that such tax has been paid.

4.3.6 Corporate Assistance. The Corporation shall not close its books against the transfer of Series C Preferred Stock or of Common Stock issued or issuable upon conversion of Series C Preferred Stock in any manner which interferes with the timely conversion of Class C Preferred Stock.

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4.4 Adjustments to Series C Conversion Price.

4.4.1 Subdivision or Combination of Common Stock. If the Corporation at any time subdivides (by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into a greater number of shares, the Series C Conversion Price in effect immediately prior to such subdivision shall be proportionately reduced, and if the Corporation at any time combines (by reverse stock split or otherwise) on ore more classes of its outstanding shares of Common Stock into a smaller number of shares, the Series C Conversion Price in effect immediately prior to such combination shall be proportionately increased.

4.4.2 Reorganization, Reclassification, Consolidation, Merger or Sale. Any recapitalization, reorganization, reclassification, consolidation, merger, sale of all or substantially all of the Corporation’s assets or other transaction, in each case which is effected in such a manner that the holders of Common Stock are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common Stock, is referred to herein as an “Organic Change”. Prior to the consummation of any Organic Change, the Corporation shall make appropriate provisions (in form and substance satisfactory to the holders of a majority of the Series C Preferred Stock then outstanding, such approval not to be unreasonably withheld, delayed or conditioned) to insure that the Series C Preferred Stock shall not be cancelled or retired as a result of such Organic Change and each of the holders of the Series C Preferred Stock shall thereafter have the right to acquire and receive, in lieu of or in addition to (as the case may be) the shares of Common Stock immediately theretofore acquirable and receivable upon the conversion of such holder’s Series C Preferred Stock, such shares of stock, securities, or assets as such holder would have received in connection with such Organic Change if such holder had converted its Series Class C Preferred Stock immediately prior to such Organic Change. In each such case, the Corporation shall also make appropriate provisions (in form and substance satisfactory to the holders of a majority of the of the Series C Preferred Stock then outstanding, such approval not to be unreasonably withheld, delayed or conditioned) to insure that the provisions of Section 4 shall thereafter be applicable to the Series C Preferred Stock (including, in the case of any such consolidation merger or sale in which the successor entity or purchasing entity is other than the Corporation, an immediate adjustment to the Series C Conversion Price to the value of the Common Stock reflected by the terms of such consolidation, merger or sale, and a corresponding immediate adjustment in the number of shares of Common Stock acquirable and receivable upon conversion of Series C Preferred Stock, if the value so reflected is less than the Series C Conversion Price in effect immediately prior to such consolidation, merger or sale). The Corporation shall not effect any such consolidation, merger or sale, unless prior to the consummation thereof, the successor entity (if other than the Corporation) resulting from consolidation or merger or the entity purchasing such assets assumes by written instrument (in form and substance satisfactory to the holders of a majority of the Series C Preferred Stock then outstanding, such approval not to be unreasonably withheld, delayed or conditioned), the obligation to deliver to each such holder such shares of stock, securities or assets as, in accordance with the foregoing provisions, such holder may be entitled to acquire.

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4.4.3 Other Distributions. In the event the Corporation shall declare a distribution payable in securities of other persons, evidences of indebtedness issued by this Corporation or other persons, assets (excluding cash dividends) or options or rights not otherwise referred to in Section 1, then, in each such case for the purpose of this Subsection 4.4.3, the holders of the Series C Preferred Stock shall be entitled to a proportionate share of any such distribution as though they were the holders of the number of shares of Common Stock of the Corporation into which their shares of Series C Preferred Stock are convertible as of the record date fixed for the determination of the holders of Common Stock of the Corporation entitled to receive such distribution.

4.4.4 Adjustments for Diluting Issues. If, at any time following the Series C Original Issue Date, the Corporation grants anti-dilution protection in the form of a right to an adjustment to the conversion price of any security other than the Series C Preferred Stock (a “Trigger Event”), the following anti-dilution provision shall be applied retroactively to shares of Series C Preferred Stock such that the Series C Conversion Price is adjusted for any and all issuances without consideration or for a consideration per share less than the Series C Conversion Price subsequent to the Series C Original Issue Date, as if such anti-dilution protection had been in place from the Series C Original Issue Date. When determining any adjustment to the Series C Conversion Price in accordance with this Subsection 4.4.4, each issuance shall be analyzed in chronological order from the Series C Original Issue Date. Notwithstanding anything to the contrary set forth herein, if anti-dilution adjustments are granted to any security other than the Series C Preferred Stock on terms more favorable than those set forth herein, the Company and the holders of Series C Preferred Stock shall use their best efforts to cause the Series C Preferred Stock to have the same rights.

(a) Conversion Price. Following a Trigger Event, if (i) the Corporation has issued any Additional Shares of Common Stock (including Additional Shares of Common Stock deemed to be issued pursuant to Subsection 4.4.4(b)) since the Series C Original Issue Date at a price per share less than the Series C Conversion Price or (ii) if the Corporation thereafter issues any Additional Shares of Common Stock (including Additional Shares of Common Stock deemed to be issued pursuant to Subsection 4.4.4(b)) at a price per share less than the Series C Conversion Price, then immediately (or, if later, upon a Trigger Event) upon such issue or deemed issue, the Series C Conversion Price shall be reduced to the Series C Conversion Price determined by dividing (a) the sum of (i) the product derived by multiplying the Series C Conversion Price in effect immediately prior to such issue or sale by the number of shares of Common Stock Deemed Outstanding immediately prior to such issue or sale, plus (2) the consideration, if any, received by the Corporation upon such issue or sale, by (b) the number of shares of Common Stock Deemed Outstanding immediately after such issue or sale.

(b) Effect on Series C Conversion Price of Certain Events. For purposes of determining the adjusted Series C Conversion Price under Subsection 4.4.4(a), the following shall be applicable:

(i) Issue of Rights or Options. If the Corporation in any manner grants or sells any Options (excluding Options which are themselves Exempted Securities) and the price per share for which Common Stock is issuable upon the exercise of such Options, or upon conversion or exchange of any Convertible Securities issuable upon exercise of such Options, is less than the Series C Conversion Price in effect immediately prior to the time of the granting or sale of such Options, then the total maximum number of shares of Common

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Stock issuable upon the exercise of such Options or upon conversion or exchange of the total maximum amount of such Convertible Securities issuable upon the exercise of such Options shall be deemed to be outstanding and to have been issued and sold by the Corporation at the time of the granting or sale of such Options for such price per share. For purposes of this Subsection 4.4.4(b), the “price per share for which Common Stock is issuable” shall be determined by dividing (A) the total amount, if any, received or receivable by the Corporation as consideration for the granting or sale of such Options, plus the minimum aggregate amount of additional consideration payable to the Corporation upon exercise of all such Options, plus in the case of such Options which relate to Convertible Securities, the minimum aggregate amount of additional consideration, if any, payable to the Corporation upon the issuance or sale of such Convertible Securities and the conversion or exchange thereof, by (B) the total maximum number of shares of Common Stock issuable upon the exercise of such Options or upon the conversion or exchange of all such Convertible Securities issuable upon the exercise of such Options. No further adjustment of the Series C Conversion Price shall be made when Convertible Securities are actually issued upon the exercise of such Options or when Common Stock is actually issued upon the exercise of such Options or the conversion or exchange of such Convertible Securities.

(ii) Issuance of Convertible Securities. If the Corporation in any manner issues or sells any Convertible Securities (excluding Convertible Securities which are themselves Exempted Securities) and the price per share for which Common Stock is issuable upon conversion or exchange thereof is less than the Series C Conversion Price in effect immediately prior to the time of the granting or sale of such Convertible Securities, then the maximum number of shares of Common Stock issuable upon conversion or exchange of such Convertible Securities shall be deemed to be outstanding and to have been issued and sold by the Corporation at the time of the issuance or sale of such Convertible Securities for such price per share. For the purposes of this Subsection 4.4.4(b), the “price per share for which Common Stock is issuable” shall be determined by dividing (A) the total amount received or receivable by the Corporation as consideration for the issue or sale of such Convertible Securities, plus the minimum aggregate amount of additional consideration, if any, payable to the Corporation upon the conversion or exchange thereof, by (B) the total maximum number of shares of Common Stock issuable upon the conversion or exchange of all such Convertible Securities. No further adjustment of the Series C Conversion Price shall be made when Common Stock is actually issued upon the conversion or exchange of such Convertible Securities, and if any such issuance or sale of such Convertible Securities is made upon exercise of any Options for which adjustments of the Conversion Price had been or are to be made pursuant to other provisions of Section 4, no further adjustment of the Series C Conversion Price shall be made by reason of such issue or sale.

(iii) Change in Option Price or Conversion Rate.

(1) If the terms of any Option or Convertible Security, the issuance of which resulted in an adjustment to the Series C Conversion Price pursuant to the terms of Subsection 4.4.4(a), are revised as a result of an amendment to such terms or any other adjustment pursuant to the provisions of such Option or Convertible Security (but excluding automatic adjustments to such terms pursuant to

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anti-dilution or similar provisions of such Option or Convertible Security), to provide for a change in the purchase price provided for in any Options, the additional consideration, if any, payable upon the conversion or exchange of any Convertible Securities or the rate at which any Convertible Securities are convertible into or exchangeable for Common Stock, the Series C Conversion Price in effect at the time of such change shall be immediately adjusted to the Series C Conversion Price which would have been in effect at such time had such Options or Convertible Securities still outstanding provided for such changed purchase price, additional consideration or conversion rate, as the case may be, at the time initially granted, issued or sold. For purposes of Subsection 4.4.4(b), if the terms of any Option or Convertible Security which was outstanding as of the date of issuance of the Series C Preferred Stock are changed in the manner described in the immediately preceding sentence, then such Option or Convertible Security and the Common Stock deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date of such change. Notwithstanding the foregoing, no readjustment pursuant to this Subsection 4.4.4(b)(iii) shall have the effect of increasing the Series C Conversion Price to an amount that exceeds the lower of (a) the Series C Conversion Price in effect immediately prior to the original adjustment made as a result of the issuance of such Option or Convertible Security, or (b) the Series C Conversion Price that would have resulted from any issuances of Additional Shares of Common Stock (other than deemed issuances of Additional Shares of Common Stock as a result of the issuance of such Option or Convertible Security) between the original adjustment date and such readjustment date.

(2) If the terms of any Option or Convertible Security (excluding Options or Convertible Securities which are themselves Exempted Securities), the issuance of which did not result in an adjustment to the Series C Conversion Price pursuant to the terms of Subsection 4.4.4(a) (either because the consideration per share (determined pursuant to Subsection 4.4.4(b)(v)) of the Additional Shares of Common Stock subject thereto was equal to or greater than the Series C Conversion Price then in effect, or because such Option or Convertible Security was issued before the Series C Original Issue Date), are revised as a result of an amendment to such terms or any other adjustment pursuant to the provisions of such Option or Convertible Security (but excluding automatic adjustments to such terms

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pursuant to anti-dilution or similar provisions of such Option or Convertible Security), to provide for a change in the purchase price provided for in any Options, the additional consideration, if any, payable upon the conversion or exchange of any Convertible Securities or the rate at which any Convertible Securities are convertible into or exchangeable for Common Stock, the Series C Conversion Price in effect at the time of such change shall be immediately adjusted to the Series C Conversion Price which would have been in effect at such time had such Options or Convertible Securities still outstanding provided for such changed purchase price, additional consideration or conversion rate, as the case may be, at the time initially granted, issued or sold. For purposes of Subsection 4.4.4(b), if the terms of any Option or Convertible Security which was outstanding as of the date of issuance of the Series C Preferred Stock are changed in the manner described in the immediately preceding sentence, then such Option or Convertible Security and the Common Stock deemed issuable upon exercise, conversion or exchange thereof shall be deemed to have been issued as of the date of such change; provided that no such change shall at any time cause the Series C Conversion Price hereunder to be increased.

(iv) Treatment of Expired Options and Unexercised Convertible Securities. Upon the expiration of any Option or the termination of any right to convert or exchange any Convertible Security without the exercise of such Option or right, the Series C Conversion Price then in effect hereunder shall be adjusted immediately to the Series C Conversion Price which would have been in effect at the time of such expiration or termination had such Option or Convertible Security, to the extent outstanding immediately prior to such expiration or termination, never been issued. For purposes of Subsection 4.4.4(b), the expiration or termination of any Option or Convertible Security which was outstanding as of the date of issuance of the Series C Preferred Stock shall not cause the Series C Conversion Price hereunder to be adjusted unless, and only to the extent that, a change in the terms of such Option or Convertible Security caused it to be deemed to have been issued after the date of the issuance of the Series C Preferred Stock.

(v) Calculation of Consideration Received. If any Common Stock, Option or Convertible Security is issued or sold or deemed to have been issued or sold for cash, the consideration received therefor shall be deemed to be the amount received by the Corporation therefor. If any Common Stock, Option or Convertible Security is issued or sold for consideration other than cash, the amount of the consideration other than cash received by the Corporation shall be the fair market value of such consideration, except where such consideration consists of securities, in which case the amount of consideration received by the Corporation shall be the Market Price thereof as of the date of receipt. If any Common Stock, Option or Convertible Security is issued to the owners of the non-surviving entity in connection with any merger in which the Corporation is the surviving corporation, the amount of

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consideration therefor shall be deemed to be the fair value of the portion of the net assets of the non-surviving entity that is attributable to such Common Stock, Option or Convertible Security, as the case may be. The fair value of any consideration or net assets other than cash and securities (and, if applicable, the portions thereof attributable to any such stock or securities) shall be determined in good faith by the Board of Directors of the Corporation.

(vi) Integrated Transactions. In case any Option is issued in connection with the issue or sale of other securities of the Corporation, together comprising one integrated transaction in which no specific consideration is allocated to such Option by the parties thereto, the Option shall be deemed to have been issued for a consideration of $.01.

(vii) Treasury Shares. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of the Corporation or any Subsidiary, and the disposition of any shares so owned or held shall be considered an issue or sale of Common Stock.

(viii) Certain Events. If any event occurs of the type contemplated by the provisions of Section 4, but not expressly provided for by such provisions (including, without limitation, the granting of stock appreciation rights, phantom stock rights or other rights with equity features), then the Corporation’s Board of Directors shall make an appropriate adjustment in the Series C Conversion Price so as to protect the rights of the holders of Series C Preferred Stock; provided that no such adjustment shall increase the Series C Conversion Price as otherwise determined pursuant to Section 4 or decrease the number of shares of Common Stock issuable upon conversion of each share of Series C Preferred Stock.

4.4.5 Notices.

(a) Immediately upon any adjustment to the Series C Conversion Price, the Corporation shall give written notice thereof to all holders of Series C Preferred Stock, setting forth in reasonable detail and certifying the calculation of such adjustment, regardless of whether the Corporation’s anti-dilution protection has been triggered.

(b) The. Corporation shall give written notice of all holders of Series C Preferred Stock at least 10 days prior to the date on which the Corporation closes its books or takes a records (i) with respect to any dividend or distribution upon Common Stock or (b) with respect to any pro rata subscription offer to holders of Common Stock.

(c) The Corporation shall also give written notice to the holders of Series C Preferred Stock at least 10 days prior to the date on which any Organic Change shall take place.

5. Mandatory Conversion.

5.1 Trigger Events. Upon the closing of the sale of shares of Common Stock to the public at a price of at least $16.00 per share (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Common Stock), in a firm-commitment underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), resulting in at least $75,000,000 of gross

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proceeds to the Corporation (the time of such closing is referred to herein as the “Mandatory Conversion Time”), (i) all outstanding shares of Series C Preferred Stock shall automatically be converted into shares of Common Stock, at the then effective conversion rate as established by Section 4 and (ii) such shares may not be reissued by the Corporation.

5.2 Procedural Requirements. All holders of record of shares of Series C Preferred Stock shall be sent written notice of the Mandatory Conversion Time and the place designated for mandatory conversion of all such shares of Series C Preferred Stock pursuant to this Section 5. Such notice need not be sent in advance of the occurrence of the Mandatory Conversion Time. Upon receipt of such notice, each holder of shares of Series C Preferred Stock shall, surrender his, her or its certificate or certificates for all such shares (or, if such holder alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably acceptable to the Corporation to indemnify the Corporation against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate) to the Corporation at the place designated in such notice. If so required by the Corporation, certificates surrendered for conversion shall be endorsed or accompanied by written instrument or instruments of transfer, in form satisfactory to the Corporation, duly executed by the registered holder or by his, her or its attorney duly authorized in writing. All rights with respect to the Series C Preferred Stock converted pursuant to Section 5.1, including the rights, if any, to receive notices and vote (other than as a holder of Common Stock), will terminate at the Mandatory Conversion Time (notwithstanding the failure of the holder or holders thereof to surrender the certificates at or prior to such time), except only the rights of the holders thereof, upon surrender of their certificate or certificates (or lost certificate affidavit and agreement) therefor, to receive the items provided for in the next sentence of this Section 5.2. As soon as practicable after the Mandatory Conversion Time and the surrender of the certificate or certificates (or lost certificate affidavit and agreement) for Series C Preferred Stock, the Corporation shall issue and deliver to such holder, or to his, her or its nominees, a certificate or certificates for the number of full shares of Common Stock issuable on such conversion in accordance with the provisions hereof, together with cash as provided in Section 4.2 in lieu of any fraction of a share of Common Stock otherwise issuable upon such conversion and the payment of any declared but unpaid dividends on the shares of Series C Preferred Stock converted. Such converted Series C Preferred Stock shall be retired and cancelled and may not be reissued as shares of such series, and the Corporation may thereafter take such appropriate action (without the need for stockholder action) as may be necessary to reduce the authorized number of shares of Series C Preferred Stock accordingly.

6. Redemption Rights.

6.1 Redemption at Election of Holder. At any time on or after the fifth anniversary of the Series C Original Issue Date, all then-outstanding shares of Series C Preferred Stock shall be redeemed by the Corporation out of funds lawfully available therefor at a price equal to the Series C Original Issue Price per share, plus an amount in cash equal to any and all accrued but unpaid dividends thereon, whether or not declared (the “Series C Redemption Price”) within sixty (60) days after written notice is received by the Corporation from the holders of at least a majority of the then-outstanding shares

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of Series C Preferred Stock requesting redemption of all shares of Series C Preferred Stock (a “Series C Holder Redemption Notice”). The Series C Holder Redemption Notice may not be given prior to the earliest of (i) sixty (60) days prior to the fifth anniversary of the Series C Original Issue Date or (ii) the occurrence of a Series C Preferred Stock Event of Noncompliance as described in Section 7.1. Written notice of receipt of any Series C Holder Redemption Notice shall be sent by the Corporation to each holder of record of Series C Preferred Stock and Series B Preferred Stock not less than ten (10) days prior to the date specified by the Corporation as the date such shares shall be redeemed, which redemption date shall in no event be later than sixty (60) days following receipt by the Corporation of the Series C Holder Redemption Notice (the “Series C Holder Redemption Date”). The Corporation shall promptly provide notice of receipt of any Series C Holder Redemption Notice to the holders of Series B Preferred Stock, and the holders of at least a majority of the then-outstanding shares of Series B Preferred Stock may, within five (5) days of such notice, request redemption pursuant to this Section 6.1. Any such redemption shall occur on the same date as the redemption of the Series C Preferred Stock detailed in the Series C Holder Redemption Notice. Notwithstanding the foregoing, the holders of Series B Preferred Stock shall not have a redemption right pursuant to this Section 6.1 and shall not receive notice of a Series C Holder Redemption Notice if such Series C Holder Redemption Notice was delivered following a Series C Preferred Stock Event of Noncompliance as described in Section 7.1.

6.2 Allocation. In the case of any redemption pursuant to Section 6.1, if the Corporation does not have sufficient funds legally available to redeem on any Series C Holder Redemption Date all shares of Series C Preferred Stock and Series B Preferred Stock (if any) to be redeemed on such redemption date, the Corporation shall redeem a pro rata portion of each holder’s redeemable shares of Series C Preferred Stock and Series B Preferred Stock (if any) out of funds legally available therefor, based on the respective amounts which would otherwise be payable in respect of the shares to be redeemed if the legally available funds were sufficient to redeem all such shares, and shall redeem the remaining shares requested to have been redeemed as soon as practicable after the Corporation has funds legally available therefor. Pending any such redemption, any such unredeemed shares of Series C Preferred Stock and Series B Preferred Stock (if any) shall continue to accrue and be paid dividends and all other rights with respect to such shares shall continue in full force and effect. In case fewer than the total number of shares of Series C Preferred Stock or Series B Preferred Stock (if any) represented by any certificate are redeemed, a new certificate representing the total number of unredeemed shares of Series C Preferred Stock or Series B Preferred Stock, as applicable, shall be issued to the holder thereof without cost to such holder within three business days after surrender of the certificate representing the redeemed shares of Series C Preferred Stock or Series B Preferred Stock, as applicable.

6.3 Redemption Notice. Written notice of a redemption (a “Series C Redemption Notice”) shall be sent by the Corporation to each holder of record of Series C Preferred Stock and Series B Preferred Stock at the times indicated in Section 6.1 above. Each Series C Redemption Notice shall state:

(a) the number of shares of Series C Preferred Stock and Series B Preferred Stock held by the holder that the Corporation shall redeem on the Series C Holder Redemption Date;

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(b) the Series C Holder Redemption Date, as applicable, and (i) the Series C Redemption Price and (ii) the price equal to the Series B Original Issue Price per share, plus any unpaid cash dividends payable in lieu of fractional shares in accordance with Section 1.2, (the “Series B Redemption Price”); and

(c) that the holder is to surrender to the Corporation, in the manner and at the place designated, his, her or its certificate or certificates representing the shares of Series C Preferred Stock or Series B Preferred Stock, as applicable, to be redeemed.

6.4 Surrender of Certificates; Payment. On or before the applicable Redemption Date, each holder of shares of Series C Preferred Stock or Series B Preferred Stock (if any) to be redeemed on such Redemption Date shall surrender the certificate or certificates representing such shares (or, if such registered holder alleges that such certificate has been lost, stolen or destroyed, a lost certificate affidavit and agreement reasonably acceptable to the Corporation to indemnify the Corporation against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate) to the Corporation, in the manner and at the place designated in the Series C Redemption Notice, and thereupon the Redemption Price for such shares shall be payable to the order of the person whose name appears on such certificate or certificates as the owner thereof. In the event less than all of the shares of Series C Preferred Stock or Series B Preferred Stock (if any) represented by a certificate are redeemed, a new certificate representing the unredeemed shares of Series C Preferred Stock or Series B Preferred Stock, as applicable, shall promptly be issued to such holder.

6.5 Rights Subsequent to Redemption. If the Series C Redemption Notice shall have been duly given, and if on the applicable Redemption Date the Redemption Price payable upon redemption of the shares of Series C Preferred Stock or Series B Preferred Stock (if any) to be redeemed on such Redemption Date is paid or tendered for payment to the holder thereof or deposited with an independent payment agent so as to be available therefor, then notwithstanding that the certificates evidencing any of the shares of Series C Preferred Stock or Series B Preferred Stock, as applicable, so called for redemption shall not have been surrendered, dividends with respect to such shares of Series C Preferred Stock and Series B Preferred Stock, as applicable, shall cease to accrue after such Redemption Date and all rights with respect to such shares shall forthwith after the Redemption Date terminate, except only the right of the holders to receive the Redemption Price without interest upon surrender of their certificate or certificates therefor.

7. Series C Preferred Stock Events of Noncompliance.

7.1 Definition. A Series C Preferred Stock Event of Noncompliance shall have occurred if:

(a) the Corporation fails to make any redemption payment with respect to the Class C Preferred Stock which it is required to make hereunder, whether or not such payment is legally permissible or is prohibited by any agreement to which the Corporation is subject;

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(b) the Corporation or any Subsidiary makes an assignment for the benefit of creditors or admits in writing its inability to pay its debts generally as they become due; or an order, judgment or decree is entered adjudicating the Corporation or any Subsidiary bankrupt or insolvent; or any order for relief with respect to the Corporation or any Subsidiary is entered under the Federal Bankruptcy Code; or the Corporation or any Subsidiary petitions or applies to any tribunal for the appointment of a custodian, trustee, receiver or liquidator of the Corporation or any Subsidiary or of any substantial part of the assets of the Corporation or any Subsidiary, or commences any proceeding (other than a proceeding for the voluntary liquidation and dissolution of a Subsidiary) relating to the Corporation or any Subsidiary under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction; or any such petition or application is filed, or any such proceeding is commenced, against the Corporation or any Subsidiary and either (a) the Corporation or any such Subsidiary by any act indicates its approval thereof, consent thereto or acquiescence therein or (b) such petition, application or proceeding is not dismissed within 60 days; or

(c) the Corporation or any Subsidiary defaults in the performance of any obligation or agreement if the effect of such default is to cause an amount exceeding $2,000,000 to become due prior to its stated maturity.

The foregoing shall constitute Events of Noncompliance whatever the reason or cause for any such Event of Noncompliance and whether it is voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body and regardless of the effects of any subordination provisions.

7.2 Consequences of Events of Noncompliance.

(a) If a Series C Preferred Stock Event of Noncompliance has occurred, the dividend rate on the Series C Preferred Stock shall increase immediately to 17%. Any increase of the dividend rate resulting from the operation of this paragraph shall terminate as of the close of business on the date on which no Series C Preferred Stock Event of Noncompliance exists, subject to subsequent increases pursuant to this paragraph.

(b) If any Series C Preferred Stock Event or Events of Noncompliance exist for an aggregate of 365 days (whether or not such days are consecutive), the Series C Conversion Price of the Series C Preferred Stock shall be reduced immediately by 10% of the Series C Conversion Price in effect immediately prior to such adjustment. In no event shall this Conversion Price adjustment be rescinded.

(c) If any Series C Preferred Stock Event of Noncompliance exists, each holder of Series C Preferred Stock shall also have any other rights which such holder is entitled to under any contract or agreement at any time and any other rights which such holder may have pursuant to applicable law.

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8. Series B Preferred Stock Events of Noncompliance.

8.1 Definition. A Series B Preferred Stock Event of Noncompliance shall have occurred if:

(a) the Corporation fails to make any redemption payment with respect to the Class B Preferred Stock which it is required to make hereunder, whether or not such payment is legally permissible or is prohibited by any agreement to which the Corporation is subject;

(b) the Corporation or any Subsidiary makes an assignment for the benefit of creditors or admits in writing its inability to pay its debts generally as they become due; or an order, judgment or decree is entered adjudicating the Corporation or any Subsidiary bankrupt or insolvent; or any order for relief with respect to the Corporation or any Subsidiary is entered under the Federal Bankruptcy Code; or the Corporation or any Subsidiary petitions or applies to any tribunal for the appointment of a custodian, trustee, receiver or liquidator of the Corporation or any Subsidiary or of any substantial part of the assets of the Corporation or any Subsidiary, or commences any proceeding (other than a proceeding for the voluntary liquidation and dissolution of a Subsidiary) relating to the Corporation or any Subsidiary under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction; or any such petition or application is filed, or any such proceeding is commenced, against the Corporation or any Subsidiary and either (a) the Corporation or any such Subsidiary by any act indicates its approval thereof, consent thereto or acquiescence therein or (b) such petition, application or proceeding is not dismissed within 60 days; or

(c) the Corporation or any Subsidiary defaults in the performance of any obligation or agreement if the effect of such default is to cause an amount exceeding $2,000,000 to become due prior to its stated maturity.

8.2 Consequences of Events of Noncompliance. If a Series B Preferred Stock Event of Noncompliance has occurred, the dividend rate on the Series B Preferred Stock shall increase immediately to 17%, Any increase of the dividend rate resulting from the operation of this paragraph shall terminate as of the close of business on the date on which no Series B Preferred Stock Event of Noncompliance exists, subject to subsequent increases pursuant to this paragraph.

9. Series C Preferred Stock Protective Provisions. At any time when shares of Series C Preferred Stock are outstanding, the Corporation shall not, either directly or indirectly by amendment, merger, consolidation or otherwise, do any of the following without (in addition to any other vote required by law or the Certificate of Incorporation) the written consent or affirmative vote of the holders of at least 50% of the then outstanding shares of Series C Preferred Stock, given in writing or by vote at a meeting, consenting or voting (as the case may be) separately as a class:

(a) amend, alter or repeal any provision of the Certificate of Incorporation or Bylaws of the Corporation in a manner that adversely affects the powers, preferences or rights of the Series C Preferred Stock;

(b) create, or authorize the creation of, or issue or obligate itself to issue shares of, any additional class or series of capital stock, or increase the authorized number of shares of Series B Preferred Stock or Series C Preferred Stock or increase the authorized number of shares of any additional class or series of capital stock; or

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(c) (i) reclassify, alter or amend any existing security of the Corporation that is pari passu with the Series C Preferred Stock in respect of the distribution of assets on the liquidation, dissolution or winding up of the Corporation, the payment of dividends or rights of redemption, if such reclassification, alteration or amendment would render such other security senior to the Series C Preferred Stock in respect of any such right, preference or privilege, or (ii) reclassify, alter or amend any existing security of the Corporation that is junior to the Series C Preferred Stock in respect of the distribution of assets on the liquidation, dissolution or winding up of the Corporation, the payment of dividends or rights of redemption, if such reclassification, alteration or amendment would render such other security senior to or pari passu with the Series C Preferred Stock in respect of any such right, preference or privilege; or

(d) redeem, purchase or otherwise acquire directly or indirectly any Common Stock, or any other class or series of capital stock ranking on liquidation pari passu with or junior to the Series C Preferred Stock, nor directly or indirectly pay or declare any dividend or make any distribution upon any Common Stock, or any other class or series of capital stock ranking on liquidation pari passu with or junior to the Series C Preferred Stock.

10. Definitions.

“Additional Shares of Common Stock” means all shares of Common Stock issued (or, pursuant to Section 4.4.4(b), deemed to be issued) by the Corporation after the Series C Original Issue Date, other than (1) the following shares of Common Stock and (2) shares of Common Stock deemed issued pursuant to the following Options and Convertible Securities (clauses (i) and (ii), collectively, “Exempted Securities”):

(a) shares of Common Stock, Options or Convertible Securities issued as a dividend or distribution on Series C Preferred Stock;

(b) additional Shares of Series C Preferred Stock issued pursuant to the Purchase Agreement;

(c) shares of Common Stock, Options or Convertible Securities issued by reason of a dividend, stock split, split-up or other distribution on shares of Common Stock that is covered by Subsection 4.4.1, 4.4.2 or 4.4.3;

(d) shares of Common Stock issued in a sale of Common Stock to the public effected pursuant to a registration statement filed with, and declared effective by, the Securities and Exchange Commission under the Federal Act, at a price per share of at least $16.00 (as adjusted for stock splits, stock dividends, and the like) and resulting in aggregate gross proceeds to the Company of at least $75,000,000;

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(e) shares of Common Stock issued or issuable pursuant to the acquisition of another corporation by the Corporation by merger, purchase of substantially all of the assets or other reorganization or to a joint venture agreement, provided that such issuances are approved by the Board of Directors of the Corporation; or

(f) shares of Common Stock or Options issued to employees or directors of, or consultants or advisors to, the Corporation or any of its subsidiaries pursuant to any plan, agreement or arrangement approved by the Board of Directors of the Corporation.

“Common Stock Deemed Outstanding” means, at any given time, the number of shares of Common Stock actually outstanding at such time, plus the number of shares of Common Stock deemed to be outstanding pursuant to Subsections 4.4.4(b)(i) and 4.4.4(b)(ii) hereof whether or not Options or Convertible Securities are actually exercisable at such time.

“Convertible Securities” means any stock or securities (other than Options) directly or indirectly convertible into or exchangeable for Common Stock.

“Options” means any rights, warrants or options to subscribe for or purchase Common Stock or Convertible Securities.

“Market Price” of any security means the average of the closing prices of such security’s sales on all securities exchanges on which such security may at the time be listed, or, if there has been no sales on any such exchange on any day, the average of the highest bid and lowest asked prices on all such exchanges at the end of such day, or, if on any day such security is not so listed, the average of the heist bid and lowest asked prices on such day in the domestic over-the-counter market as reported by Pink OTC Markets, Inc., or any similar successor organization, in each such case averaged over a period of 21 days consisting of the day as of which “Market Price” is being determined and the 20 consecutive business days prior to such day; provided that if such security is listed on any domestic securities exchange, the term “business days” as used in this sentence means business days on which such exchange is open for trading. If at any time such security is not listed on any securities exchange or quoted in the over-the-counter market, the “Market Price” shall be the fair value thereof determined in good faith by the Board of Directors.

“Purchase Agreement” means the Stock Purchase Agreement, dated as of December     , 2010, by and among the Corporation and the investors listed on Exhibit A attached thereto.

“Subsidiary” means any corporation of which the shares of outstanding capital stock possessing the voting power (under ordinary circumstances) in electing the board of directors are, at the time as of which any determination is being made, owned by the Corporation either directly or indirectly.

FIFTH: The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to the powers and authority expressly conferred upon them by statute or by this Second Amended and Restated Certificate of Incorporation or the Bylaws of the Corporation, the directors are hereby empowered to exercise

24

all such powers and do all such acts and things as may be exercised or done by the Corporation. The election of directors shall at all times be subject to the terms of Section 4.1 to Section 4.4 of that certain Stockholders Agreement, dated as of December 23, 2010, by and among the Corporation and holders of the Common Stock, the Series B Preferred Stock and the Series C Preferred Stock entered into in connection with the issuance of the Series C Preferred Stock (the “Stockholders Agreement”).

SIXTH: The Board of Directors is authorized to make, adopt, amend, alter or repeal the Bylaws of the Corporation. The stockholders shall also have power to make, adopt, amend, alter or repeal the Bylaws of the Corporation.

SEVENTH: Subject to any additional vote required by the Second Amended and Restated Certificate of Incorporation, the number of directors of the Corporation shall be determined in the manner set forth in the Bylaws of the Corporation.

EIGHTH: Elections of directors need not be by written ballot unless the Bylaws of the Corporation shall so provide.

NINTH. Meetings of stockholders may be held within or without the State of Delaware, as the Bylaws of the Corporation may provide. The books of the Corporation may be kept outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the Bylaws of the Corporation.

TENTH. To the fullest extent permitted by law, a director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. If the General Corporation Law or any other law of the State of Delaware is amended after approval by the stockholders of this Article Tenth to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the General Corporation Law as so amended.

Any repeal or modification of the foregoing provisions of this Article Tenth by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation existing at the time of, or increase the liability of any director of the Corporation with respect to any acts or omissions of such director occurring prior to, such repeal or modification.

ELEVENTH. To the fullest extent permitted by the General Corporation Law, the Corporation renounces any interest or expectancy of the Corporation in, or in being offered an opportunity to participate in, business opportunities that are presented to (i) the MidOcean Group (as defined in the Stockholders Agreement) and (ii) any officer, director, equity holder or employee of the Corporation who is an employee of the MidOcean Group or any of its Affiliates (each, a “Specified Director”). Without limiting the generality of the foregoing, the Corporation specifically renounces any rights the Corporation might have in any business venture or business opportunity of the MidOcean Group or any of its Affiliates, and none of the Specified Directors or the MidOcean Group or any of their respective Affiliates shall have any obligation to offer any interest in any such business venture or business opportunity to the Corporation or otherwise account to the Corporation in respect of any such business ventures or opportunities. Furthermore, it shall not be deemed a breach of any fiduciary or other duties, if any, whether

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express or implied, for any Specified Director or the MidOcean Group to permit itself or one of its Affiliates to engage in a business opportunity in preference or to the exclusion of the Corporation. As used in this Article ELEVENTH, an “Affiliate” (a) of any person shall mean any other person controlling, controlled by or under common control with such person, (b) in the case of the MidOcean Group, includes any investment fund sponsored by an Affiliate of the MidOcean Group and (c) in all cases shall not include the Corporation or its subsidiaries.

*    *    *

3. That the foregoing amendment and restatement was approved by the holders of the requisite number of shares of this Corporation in accordance with Section 228 of the General Corporation Law.

4. That this Second Amended and Restated Certificate of Incorporation, which restates and integrates and further amends the provisions of this Corporation’s Certificate of Incorporation, has been duly adopted in accordance with Sections 242 and 245 of the General Corporation Law.

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IN WITNESS WHEREOF, this Second Amended and Restated Certificate of Incorporation has been executed by a duly authorized officer of this Corporation on this 23rd day of December 2010.

By:	/s/ Richard Kassar
Name:	Richard Kassar
Title:	President

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EX-3.2

Exhibit 3.2

State of Delaware

Secretary of State

Division of Corporations

Delivered 04:49 PM 11/28/2011

FILED 04:16 PM 11/28/2011

SRV 111232190 - 3880284 FILE

CERTIFICATE OF AMENDMENT

TO THE

SECOND AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF PROFESSOR CONNOR’S, INC.

(Pursuant to Sections 228 and 242 of the

General Corporation Law of the State of Delaware)

Professor Connor’s, Inc. (the “Corporation”), a corporation organized and existing under and by virtue of the provisions of the General Corporation Law of the State of Delaware (the “General Corporation Law”),

DOES HEREBY CERTIFY:

1. That the name of this corporation is Professor Connor’s, Inc.

2. The fourth sentence of Article FOURTH, Part D, Section 1.1 of the Amended and Restated Certificate of Incorporation of the Corporation is hereby restated, in its entirety, to read as follows:

“Such dividends shall be fully cumulative during the Initial Period and each Quarterly Dividend Period, but not compounding during such periods, and shall accrue (whether or not declared), without interest, from the first day of the Initial Period and each Quarterly Dividend Period to and including the end of the Initial Period and such Quarterly Dividend Period (or, if sooner, the redemption of the applicable shares of Series B Preferred Stock), except that with respect to the dividends for the Initial Period, such dividends shall accrue from the Series B Original Issue Date to and including the end of the Initial Period.”

3. The first two sentences of Article FOURTH, Part E, Section 1.1 of the Amended and Restated Certificate of Incorporation of the Corporation are hereby restated, in their entirety, to read as follows:

“Except as otherwise provided herein, from and after the date of issuance of any share of Series C Preferred Stock, dividends shall accrue on each share of Series C Preferred Stock at a rate of 8% per annum of the sum of the Series C Original Purchase Price plus the amount of previously accumulated and unpaid dividends under this Section 1.1 (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Series C Preferred Stock) (the “Accruing Dividends”). Accruing Dividends shall compound on the last day of each calendar quarter following the date of issuance of the Series C Preferred Stock. Accruing Dividends shall accrue from day to day and be cumulative, whether or not declared and whether or not there are profits, surplus or other funds of the Corporation legally available for payment of the Accruing Dividends; provided, however, that except as set forth in Section 2 and Section 6, such Accruing Dividends shall be payable only when, as, and if declared by the Board of Directors (the “Series C Dividend Payment Date”).”

4. The foregoing amendment was duly adopted in accordance with Sections 228 and 242 of the General Corporation Law.

[Signature Page Follows]

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment to be executed on November 28, 2010.

PROFESSOR CONNOR’S, INC.
By:
	Name:	Stephen Macchiaverna
	Title:	Secretary

EX-3.3

Exhibit 3.3

State of Delaware

Secretary of State

Division of Corporations

Delivered 03:09 PM 06/07/2012

FILED 03:05 PM 06/07/2012

SRV 120715076 - 3880284 FILE

CERTIFICATE OF AMENDMENT

OF THE

SECOND AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF

PROFESSOR CONNOR’S, INC.

Under Section 242 of the General Corporation Law of the State of Delaware

Professor Connor’s Inc. (hereinafter called the “Corporation”), a corporation organized and existing under and by virtue of the provisions of the General Corporation Law of the State of Delaware (the “General Corporation Law”), DOES HEREBY CERTIFY, as follows:

FIRST: The name of the Corporation is Professor Connor’s, Inc.

SECOND: The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on November 12, 2004. The Amended and Restated Certificate of Incorporation of the Corporation was filed with the Secretary of State of Delaware on October 25, 2006. The Second Amended and Restated Certificate of Incorporation of the Corporation was filed with the Secretary of State of Delaware on December 23, 2010.

THIRD: The Second Amended and Restated Certificate of Incorporation of the Corporation is hereby amended by deleting the first paragraph of Article FOURTH in its entirety and substituting in lieu thereof a new first paragraph of Article FOURTH to read as follows:

“FOURTH: The total number of shares of capital stock of all classes that the Corporation shall have the authority to issue is 89,250,000 shares. The authorized capital stock is divided into (i) 35,250,000 shares of preferred stock, with par value of $0.001 per share (the “Preferred Stock”); and (ii) 54,000,000 shares of common stock (the “Common Stock”), with par value of $0.001 per share.

FOURTH: The Second Amended and Restated Certificate of Incorporation of the Corporation is hereby amended by deleting the first two sentences of Article FOURTH, Part E in their entirety and substituting in lieu thereof a new first two sentences of Article FOURTH, Part E to read as follows:

“15,000,000 shares of the authorized and unissued Preferred Stock of the Corporation are hereby designated “Series C Preferred Stock” with the following rights, preferences, powers, privileges and restrictions, qualifications and limitations. Unless otherwise indicated, references to “Sections” in this Part E of this Article Fourth refer to sections of Part E of this Article Fourth.”

FIFTH: The Second Amended and Restated Certificate of Incorporation of the Corporation is hereby amended by deleting Article FOURTH, Part E, Section 1.1 in its entirety and substituting in lieu thereof a new Article FOURTH, Part E, Section 1.1, to read as follows:

“1.1 Except as otherwise provided herein, dividends shall accrue on each share of Series C Preferred Stock at a rate of 8% per annum of the sum of the Series C Original Issue Price plus the amount of previously accumulated and unpaid dividends under this Section 1.1 (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Series C Preferred Stock) (the “Accruing Dividends”) from and after the date of issuance of each such share of Series C Preferred Stock. Accruing Dividends shall compound on the last day of each calendar quarter following the date of issuance of each such share of Series C Preferred Stock. Accruing Dividends shall accrue from day to day and be cumulative, whether or not declared and whether or not there are profits, surplus or other funds of the Corporation legally available for payment of the Accruing Dividends; provided, however, that except as set forth in Section 2 and Section 6, such Accruing Dividends shall be payable only when, as, and if declared by the Board of Directors (the “Series C Dividend Payment Date”). The date on which the Corporation issues any share of Series C Preferred Stock shall be deemed to be its “date of issuance”.

SIXTH: The amendment has been duly adopted in accordance with the provisions of Sections 228 and 242 of the General Corporation Law.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation as of this 7th day of June, 2012.

PROFESSOR CONNOR’S, INC.
By:
	Name:	Richard Kassar
	Title:	President

EX-3.4

Exhibit 3.4

State of Delaware

Secretary of State

Division of Corporations

Delivered 11:39 AM 01/29/2014

FILED 11:27 AM 01/29/2014

SRV 140105247 - 3880284 FILE

CERTIFICATE OF AMENDMENT

TO THE

SECOND AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF PROFESSOR CONNOR’S, INC.

Professor Connor’s, Inc. (the “Corporation”), a corporation duly organized and existing under the General Corporation Law of the State of Delaware (the “DGCL”),

DOES HEREBY CERTIFY:

1. The name of the corporation is Professor Connor’s, Inc.

2. Article FIRST of the Amended and Restated Certificate of Incorporation of the Corporation is hereby restated, in its entirety, to read as follows:

“FIRST: The name of this Corporation is Freshpet, Inc. (the “Corporation”).”

3. The foregoing amendment was duly adopted in accordance with Sections 228 and 242 of the DGCL.

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment to be executed on January 29, 2014.

PROFESSOR CONNOR’S, INC.
By:	/s/ Richard C. Thompson
Name:	Richard C. Thompson
Title:	Chief Executive Officer

EX-3.5

Exhibit 3.5

State of Delaware

Secretary of State

Division of Corporations

Delivered 09:43 AM 04/25/2014

FILED 09:35 AM 04/25/2014

SRV 140517269 - 3880284 FILE

CERTIFICATE OF AMENDMENT

OF THE

SECOND AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF

FRESHPET, INC.

Under Section 242 of the General Corporation Law of the State of Delaware

Freshpet, Inc. (hereinafter called the “Corporation”), a corporation organized and existing under and by virtue of the provisions of the General Corporation Law of the State of Delaware (the “General Corporation Law”), DOES HEREBY CERTIFY, as follows:

FIRST: The name of the Corporation is Freshpet, Inc.

SECOND: The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on November 12, 2004. The Amended and Restated Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on October 25, 2006. The Second Amended and Restated Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on December 23, 2010. A Certificate of Amendment was filed with the Secretary of State of the State of Delaware on November 28, 2011, a Certificate of Change of Registered Agent was filed with the Secretary of State of the State of Delaware on April 30, 2012, a Certificate of Amendment was filed with the Secretary of State of the State of Delaware on June 7, 2012 and a Certificate of Amendment was filed with the Secretary of State of the State of Delaware on January 29, 2014.

THIRD: The Second Amended and Restated Certificate of Incorporation of the Corporation is hereby amended by deleting the first paragraph of Article FOURTH in its entirety and substituting in lieu thereof a new first paragraph of Article FOURTH to read as follows:

“FOURTH: The total number of shares of capital stock of all classes that the Corporation shall have the authority to issue is 95,250,000 shares. The authorized capital stock is divided into (i) 35,250,000 shares of preferred stock, with par value of $0.001 per share (the “Preferred Stock”); and (ii) 60,000,000 shares of common stock (the “Common Stock”), with par value of $0.001 per share.

FOURTH: The Second Amended and Restated Certificate of Incorporation of the Corporation is hereby amended by deleting the first two sentences of Article FOURTH, Part E in their entirety and substituting in lieu thereof a new first two sentences of Article FOURTH, Part E to read as follows:

“20,000,000 shares of the authorized and unissued Preferred Stock of the Corporation are hereby designated “Series C Preferred Stock” with the following rights, preferences, powers, privileges and restrictions, qualifications and limitations. Unless otherwise indicated, references to “Sections” in this Part E of this Article Fourth refer to sections of Part E of this Article Fourth.”

FIFTH: The amendment has been duly adopted in accordance with the provisions of Sections 228 and 242 of the General Corporation Law.

IN WITNESS WHEREOF, the undersigned has duly executed this Certificate of Amendment of the Second Amended and Restated Certificate of Incorporation as of this 24th day of April, 2014.

FRESHPET, INC.
By:
	Name:	Richard Kassar
	Title:	President

EX-3.6

Exhibit 3.6

BYLAWS OF

PROFESSOR CONNOR’S, INC.

ARTICLE I

STOCKHOLDERS

1.1 Place of Meetings. All meetings of stockholders shall be held at such place within or without the State of Delaware as may be designated from time to time by the Board of Directors or the President and Chief Executive Officer.

1.2 Annual Meeting. The annual meeting of stockholders for the election of directors and for the transaction of such other business as may properly be brought before the meeting shall be held on a date to be fixed by the Board of Directors at the time and place to be fixed by the Board of Directors and stated in the notice of the meeting.

1.3 Special Meetings. Special meetings of stockholders may be called at any time by the Board of Directors, the Chairman of the Board or the President or the holders of record of not less than 10% of all shares entitled to cast votes at the meeting, for any purpose or purposes prescribed in the notice of the meeting and shall be held at such place, on such date and at such time as the Board may fix. Business transacted at any special meeting of stockholders shall be confined to the purpose or purposes stated in the notice of meeting.

1.4 Notice of Meetings. Written notice of each meeting of stockholders, whether annual or special, shall be given not less than 10 nor more than 60 days before the date on which the meeting is to be held, to each stockholder entitled to vote at such meeting, except as otherwise provided herein or as required by law (meaning here and hereafter, as required from time to time by the Delaware General Corporation Law or the Certificate of Incorporation). The notices of all meetings shall state the place, date and hour of the meeting. The notice of a special meeting shall state, in addition, the purpose or purposes for which the meeting is called. If mailed, notice is given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the corporation.

1.5 Voting List. The officer who has charge of the stock ledger of the corporation shall prepare, at least 10 days before each meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder, Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least 10 days prior to the meeting, at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time of the meeting, and may be inspected by any stockholder who is present. This list shall determine the identity of the stockholders entitled to vote at the meeting and the number of shares held by each of them.

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1.6 Quorum. Except as otherwise provided by law or these Bylaws, the holders of a majority of the shares of the capital stock of the corporation entitled to vote at the meeting, present in person or represented by proxy, shall constitute a quorum for the transaction of business. If a quorum shall fail to attend any meeting, the chairman of the meeting or the holders of a majority of the shares of stock entitled to vote who are present, in person or by proxy, may adjourn the meeting to another place, date or time.

If a notice of any adjourned special meeting of stockholders is sent to all stockholders entitled to vote thereat, stating that it will be held with those present constituting a quorum, then except as otherwise required by law, those present at such adjourned meeting shall constitute a quorum, and all matters shall be determined by a majority of the votes cast at such meeting.

1.7 Adjournments. Any meeting of stockholders may be adjourned to any other time and to any other place at which a meeting of stockholders may be held under these Bylaws by the Chairman of the meeting or, in the absence of such person, by any officer entitled to preside at or to act as Secretary of such meeting, or by the holders of a majority of the shares of stock present or represented at the meeting and entitled to vote, although less than a quorum. When a meeting is adjourned to another place, date or time, written notice need not be given of the adjourned meeting if the place, date and time thereof are announced at the meeting at which the adjournment is taken; provided, however, that if the date of any adjourned meeting is more than 30 days after the date for which the meeting was originally noticed, or if a new record date is fixed for the adjourned meeting, written notice of the place, date, and time of the adjourned meeting shall be given in conformity herewith. At the adjourned meeting, the corporation may transact any business which might have been transacted at the original meeting.

1.8 Voting and Proxies. Each stockholder shall have one vote for each share of stock entitled to vote held of record by such stockholder and a proportionate vote for each fractional share so held, unless otherwise provided by law or in the Certificate of Incorporation. Each stockholder of record entitled to vote at a meeting of stockholders may vote in person or may authorize any other person or persons to vote or act for him by written proxy executed by the stockholder or his authorized agent or by a transmission permitted by law and delivered to the Secretary of the corporation. No stockholder may authorize more than one proxy for his shares. Any copy, facsimile transmission or other reliable reproduction of the writing or transmission created pursuant to this Section may be substituted or used in lieu of the original writing or transmission for any and all purposes for which the original writing or transmission could be used, provided that such copy, facsimile transmission or other reproduction shall be a complete reproduction of the entire original writing or transmission.

1.9 Action at Meeting. When a quorum is present at any meeting, any election shall be determined by a plurality of the votes cast by the stockholders entitled to vote at the election, and all other matters shall be determined by a majority of the votes cast affirmatively or negatively on the matter (or if there are two or more classes of stock entitled to vote as separate classes, then in the case of each such class, a majority of each such class present or represented and voting affirmatively or negatively on the matter) shall decide such matter, except when a different vote is required by express provision of law, the Certificate of Incorporation or these Bylaws.

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All voting, including on the election of directors, but excepting where otherwise required by law, may be by a voice vote; provided, however, that upon demand therefor by a stockholder entitled to vote or his or her proxy, a stock vote shall be taken. Every stock vote shall be taken by ballot, each of which shall state the name of the stockholder or proxy voting and such other information as may be required under the procedure established for the meeting. Every vote taken by ballot shall be counted by an inspector or inspectors appointed by the chairman of the meeting, The corporation may, and to the extent required by law, shall, in advance of any meeting of stockholders, appoint one or more inspectors to act at the meeting and make a written report thereof. The corporation may designate one or more persons as an alternate inspector to replace any inspector who fails to act. If no inspector or alternate is able to act at a meeting of stockholders, the person presiding at the meeting may, and to the extent required by law, shall, appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his duties, shall take and sign an oath to faithfully execute the duties of inspector with strict impartiality and according to the best of his or her ability.

1.10 Stockholder Action Without Meeting. Any action which may be taken at any annual or special meeting of stockholders may be taken without a meeting and without prior notice, if a consent in writing, setting forth the actions so taken, is signed by the holders of outstanding shares having not less than the minimum number of votes which would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. All such consents shall be filed with the Secretary of the corporation and shall be maintained in the corporate records. Prompt notice of the taking of a corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing.

An electronic transmission consenting to an action to be taken and transmitted by a stockholder, or by a proxy holder or other person authorized to act for a stockholder, shall be deemed to be written, signed and dated for the purpose of this Section 1.10, provided that such electronic transmission sets forth or is delivered with information from which the corporation can determine (i) that the electronic transmission was transmitted by the stockholder or by a person authorized to act for the stockholder and (ii) the date on which such stockholder or authorized person transmitted such electronic transmission. The date on which such electronic transmission is transmitted shall be deemed to be the date on which such consent was signed. No consent given by electronic transmission shall be deemed to have been delivered until such consent is reproduced in paper form and until such paper form shall be delivered to the corporation by delivery to its principal place of business or an officer or agent of the corporation having custody of the books in which proceedings of meetings of stockholders are recorded.

1.11 Meetings by Remote Communication. If authorized by the Board of Directors, and subject to such guidelines and procedures as the Board may adopt, stockholders and proxy, holders not physically present at a meeting of stockholders may, by means of remote communication, participate in the meeting and be deemed present in person and vote at the meeting, whether such meeting is to be held at a designated place or solely by means of remote communication, provided that (i) the corporation shall implement reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxy holder, (ii) the corporation shall implement reasonable measures to provide such stockholders and proxy holders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with such proceedings, and (iii) if any stockholder or proxy holder votes or takes other action at the meeting by means of remote communication, a record of such vote or other action shall be maintained by the corporation.

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ARTICLE II

BOARD OF DIRECTORS

2.1 General Powers. The business and affairs of the corporation shall be managed by or under the direction of a Board of Directors, who may exercise all of the powers of the corporation except as otherwise provided by law or the Certificate of Incorporation. In the event of a vacancy in the Board of Directors, the remaining directors, except as otherwise provided by law, may exercise the powers of the full Board until the vacancy is filled.

2.2 Number and Term of Office. The number of directors shall initially be five (5) and, thereafter, shall be fixed from time to time exclusively by the Board of Directors pursuant to a resolution adopted by a majority of the total number of authorized directors (whether or not there exist any vacancies in previously authorized directorships at the time any such resolution is presented to the Board for adoption). All directors shall hold office until the expiration of the term for which elected and until their respective successors are elected, except in the case of the death, resignation or removal of any director.

2.3 Vacancies and Newly Created Directorships. Subject to the rights of the holders of any series of Preferred Stock then outstanding, newly created directorships resulting from any increase in the authorized number of directors or any vacancies in the Board of Directors resulting from death, resignation, retirement, disqualification or other cause (other than removal from office by a vote of the stockholders) may be filled only by a majority vote of the directors then in office, though less than a quorum, or by the sole remaining director, and directors so chosen shall hold office for a term expiring at the next annual meeting of stockholders. No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director.

2.4 Resignation. Any director may resign by delivering notice in writing or by electronic transmission to the President, Chairman of the Board or Secretary. Such resignation shall be effective upon receipt unless it is specified to be effective at some other time or upon the happening of some other event.

2.5 Removal. Subject to the rights of the holders of any series of Preferred Stock then outstanding, any directors, or the entire Board of Directors, may be removed from office at any time, with or without cause, by the affirmative vote of the holders of at least a majority of the voting power of all of the outstanding shares of capital stock entitled to vote generally in the election of directors, voting together as a single class. Vacancies in the Board of Directors resulting from such removal may be filled by a majority of the directors then in office, though less than a quorum, by the sole remaining director, or by the stockholders at the next annual meeting or at a special meeting called in accordance with Section 1.3 above. Directors so chosen shall hold office until the next annual meeting of stockholders.

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2.6 Regular Meetings. Regular meetings of the Board of Directors may be held without notice at such time and place, either within or without the State of Delaware, as shall be determined from time to time by the Board of Directors; provided that any director who is absent when such a determination is made shall be given notice of the determination. A regular meeting of the Board of Directors may be held without notice immediately after and at the same place as the annual meeting of stockholders.

2.7 Special Meetings. Special meetings of the Board of Directors may be called by the Chairman of the Board, the President or two or more directors and may be held at any time and place, within or without the State of Delaware.

2.8 Notice of Special Meetings. Notice of any special meeting of directors shall be given to each director by the Secretary or by the officer or one of the directors calling the meeting. Notice shall be duly given to each director by (i) giving notice to such director in person or by telephone, electronic transmission or voice message system at least 24 hours in advance of the meeting, (ii) sending a facsimile, or delivering written notice by hand, to his last known business or home address at least 24 hours in advance of the meeting, or (iii) mailing written notice to his last known business or home address at least three days in advance of the meeting. A notice or waiver of notice of a meeting of the Board of Directors need not specify the purposes of the meeting. Unless otherwise indicated in the notice thereof, any and all business may be transacted at a special meeting.

2.9 Participation in Meetings by Telephone Conference Calls or Other Methods of Communication. Directors or any members of any committee designated by the directors may participate in a meeting of the Board of Directors or such committee by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation by such means shall constitute presence in person at such meeting.

2.10 Quorum. A majority of the total number of authorized directors shall constitute a quorum at any meeting of the Board of Directors. In the event one or more of the directors shall be disqualified to vote at any meeting, then the required quorum shall be reduced by one for each such director so disqualified; provided, however, that in no case shall less than 1/3 of the number so fixed constitute a quorum. In the absence of a quorum at any such meeting, a majority of the directors present may adjourn the meeting from time to time without further notice other than announcement at the meeting, until a quorum shall be present. Interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or at a meeting of a committee which authorizes a particular contract or transaction.

2.11 Action at Meeting. At any meeting of the Board of Directors at which a quorum is present, the vote of a majority of those present shall be sufficient to take any action, unless a different vote is specified by law, the Certificate of Incorporation or these Bylaws.

2.12 Action by Written Consent. Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee of the Board of Directors may be taken without a meeting if all members of the Board or committee, as the case may be, consent to the action in writing or by electronic transmission, and the writings or electronic transmissions are filed with the minutes of proceedings of the Board or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

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2.13 Committees. The Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the corporation, with such lawfully delegated powers and duties as it therefor confers, to serve at the pleasure of the Board. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee, In the absence or disqualification of a member of a committee, the member or members of the committee present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board of Directors and subject to the provisions of the Delaware General Corporation Law, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation and may authorize the seal of the corporation to be affixed to all papers which may require it. Each such committee shall keep minutes and make such reports as the Board of Directors may from time to time request, Except as the Board of Directors may otherwise determine, any committee may make rules for the conduct of its business, but unless otherwise provided by such rules, its business shall be conducted as nearly as possible in the same manner as is provided in these Bylaws for the Board of Directors.

2.14 Compensation of Directors. Directors may be paid such compensation for their services and such reimbursement for expenses of attendance at meetings as the Board of Directors may from time to time determine. No such payment shall preclude any director from serving the corporation or any of its parent or subsidiary corporations in any other capacity and receiving compensation for such service.

2.15 Nomination of Director Candidates. Subject to the rights of holders of any class or series of Preferred Stock then outstanding, nominations for the election of Directors may be made by (i) the Board of Directors or a duly authorized committee thereof or (ii) any stockholder entitled to vote in the election of Directors.

ARTICLE III

OFFICERS

3.1 Enumeration. The officers of the corporation shall consist of a Chief Executive Officer, a President, a Secretary, a Chief Financial Officer, a Treasurer and such other officers with such other titles as the Board of Directors shall determine, including, at the discretion of the Board of Directors, a Chairman of the Board and one or more Vice Presidents and Assistant Secretaries. The Board of Directors may appoint such other officers as it may deem appropriate.

3.2 Election. Officers shall be elected annually by the Board of Directors at its first meeting following the annual meeting of stockholders. Officers may be appointed by the Board of Directors at any other meeting.

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3.3 Qualification. No officer need be a stockholder. Any two or more offices may be held by the same person.

3.4 Tenure. Except as otherwise provided by law, by the Certificate of Incorporation or by these Bylaws, each officer shall hold office until his successor is elected and qualified, unless a different term is specified in the vote appointing him, or until his earlier death, resignation or removal.

3.5 Resignation and Removal. Any officer may resign by delivering his written resignation to the corporation at its principal office or to the President or Secretary. Such resignation shall be effective upon receipt unless it is specified to be effective at some other time or upon the happening of some other event. Any officer elected by the Board of Directors may be removed at any time, with or without cause, by the Board of Directors.

3.6 Chairman of the Board. The Board of Directors may appoint a Chairman of the Board. If the Board of Directors appoints a Chairman of the Board, he shall perform such duties and possess such powers as are assigned to him by the Board of Directors. Unless otherwise provided by the Board of Directors, he shall preside at all meetings of the stockholders, and, if he is a director, at all meetings of the Board of Directors.

3.7 President. The President shall, subject to the direction of the Board of Directors, have responsibility for the general management and control of the business and affairs of the corporation and shall perform all duties and have all powers which are commonly incident to the office of President or which are delegated to him or her by the Board of Directors. Unless otherwise designated by the Board of Directors, the President shall be the Chief Executive Officer of the corporation. The President shall, in the absence of or because of the inability to act of the Chairman of the Board, perform all duties of the Chairman of the Board and preside at all meetings of the Board of Directors and of stockholders. The President shall perform such other duties and shall have such other powers as the Board of Directors may from time to time prescribe. He or she shall have power to sign stock certificates, contracts and other instruments of the corporation which are authorized and shall have general supervision and direction of all of the other officers, employees and agents of the corporation, other than the Chairman of the Board.

3.8 Vice Presidents. Any Vice President shall perform such duties and possess such powers as the Board of Directors or the President may from time to time prescribe. In the event of the absence, inability or refusal to act of the President, the Vice President (or if there shall be more than one, the Vice Presidents in the order determined by the Board of Directors) shall perform the duties of the President and when so performing shall have at the powers of and be subject to all the restrictions upon the President, The Board of Directors may assign to any Vice President the title of Executive Vice President, Senior Vice President or any other title selected by the Board of Directors.

3.9 Secretary and Assistant Secretaries. The Secretary shall perform such duties and shall have such powers as the Board of Directors or the President may from time to time prescribe. In addition, the Secretary shall perform such duties and have such powers as are incident to the office of the Secretary, including, without limitation, the duty and power to give

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notices of all meetings of stockholders and special meetings of the Board of Directors, to keep a record of the proceedings of all meetings of stockholders and the Board of Directors, to maintain a stock ledger and prepare lists of stockholders and their addresses as required, to be custodian of corporate records and the corporate seal and to affix and attest to the same on documents.

Any Assistant Secretary shall perform such duties and possess such powers as the Board of Directors, the Chief Executive Officer, the President or the Secretary may from time to time prescribe. In the event of the absence, inability or refusal to act of the Secretary, the Assistant Secretary (or if there shall be more than one, the Assistant Secretaries in the order determined by the Board of Directors) shall perform the duties and exercise the powers of the Secretary.

In the absence of the Secretary or any Assistant Secretary at any meeting of stockholders or directors, the person presiding at the meeting shall designate a temporary secretary to keep a record of the meeting.

3.10 Chief Financial Officer. Unless otherwise designated by the Board of Directors, the Chief Financial Officer shall be the Treasurer. The Chief Financial Officer shall perform such duties and shall have such powers as may from time to time be assigned to him by the Board of Directors, the Chief Executive Officer or the President. In addition, the Chief Financial Officer shall perform such duties and have such powers as are incident to the office of chief financial officer, including without limitation, the duty and power to keep and be responsible for all funds and securities of the corporation, to maintain the financial records of the corporation, to deposit funds of the corporation in depositories as authorized, to disburse such funds as authorized, to make proper accounts of such funds, and to render as required by the Board of Directors accounts of all such transactions and of the financial condition of the corporation.

3.11 Salaries. Officers of the corporation shall be entitled to such salaries, compensation or reimbursement as shall be fixed or allowed from time to time by the Board of Directors.

3.12 Delegation of Authority. The Board of Directors may from time to time delegate the powers or duties of any officer to any other officers or agents, notwithstanding any provision hereof.

ARTICLE IV

CAPITAL STOCK

4.1 Issuance of Stock. Unless otherwise voted by the stockholders and subject to the provisions of the Certificate of Incorporation, the whole or any part of any unissued balance of the authorized capital stock of the corporation or the whole or any part of any unissued balance of the authorized capital stock of the corporation held in its treasury may be issued, sold, transferred or otherwise disposed of by vote of the Board of Directors in such manner, for such consideration and on such terms as the Board of Directors may determine.

4.2 Certificates of Stock. Every holder of stock of the corporation shall be entitled to have a certificate, in such form as may be prescribed by law and by the Board of Directors, certifying the number and class of shares owned by him in the corporation. Each such certificate

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shall be signed by, or in the name of the corporation by, the Chairman or Vice Chairman, if any, of the Board of Directors, or the President or a Vice President, and the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of the corporation. Any or all of the signatures on the certificate may be a facsimile.

Each certificate for shares of stock which are subject to any restriction on transfer pursuant to the Certificate of Incorporation, the Bylaws, applicable securities laws or any agreement among any number of shareholders or among such holders and the corporation shall have conspicuously noted on the face or back of the certificate either the full text of the restriction or a statement of the existence of such restriction.

4.3 Transfers. Except as otherwise established by rules and regulations adopted by the Board of Directors, and subject to applicable law, shares of stock may be transferred on the books of the corporation by the surrender to the corporation or its transfer agent of the certificate representing such shares properly endorsed or accompanied by a written assignment or power of attorney properly executed, and with such proof of authority or authenticity of signature as the corporation or its transfer agent may reasonably require. Except as may be otherwise required by law, the Certificate of Incorporation or the Bylaws, the corporation shall be entitled to treat the record holder of stock as shown on its books as the owner of such stock for all purposes, including the payment of dividends and the right to vote with respect to such stock, regardless of any transfer, pledge or other disposition of such stock until the shares have been transferred on the books of the corporation in accordance with the requirements of these Bylaws.

4.4 Lost, Stolen or Destroyed Certificates. The corporation may issue a new certificate of stock in place of any previously issued certificate alleged to have been lost, stolen, or destroyed, upon such terms and conditions as the Board of Directors may prescribe, including the presentation of reasonable evidence of such loss, theft or destruction and the giving of such indemnity as the Board of Directors may require for the protection of the corporation or any transfer agent or registrar.

4.5 Record Date. The Board of Directors may fix in advance a record date for the determination of the stockholders entitled to notice of or to vote at any meeting of stockholders or to express consent (or dissent) to corporate action in writing without a meeting, or entitled to receive payment of any dividend or other distribution or allotment of any rights in respect of any change, concession or exchange of stock, or for the purpose of any other lawful action. Such record date shall not be more than 60 nor less than 10 days before the date of such meeting, nor more than 60 days prior to any other action to which such record date relates.

If no record date is fixed, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day before the day on which notice is given, or, if notice is waived, at the close of business on the day before the day on which the meeting is held. The record date for determining stockholders entitled to express consent to corporate action in writing without a meeting when no prior action by the Board of Directors is necessary, shall be the day on which the first written consent is expressed. The record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating to such purpose.

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A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

ARTICLE V

GENERAL PROVISIONS

5.1 Fiscal Year. The fiscal year of the corporation shall be as fixed by the Board of Directors.

5.2 Corporate Seal. The corporate seal shall be in such form as shall be approved by the Board of Directors.

5.3 Waiver of Notice. Whenever any notice whatsoever is required to be given by law, by the Certificate of Incorporation or by these Bylaws, a waiver of such notice either in writing signed by the person entitled to such notice or such person’s duly authorized attorney, or by electronic transmission or any other method permitted under the Delaware General Corporation Law, whether before, at or after the time stated in such waiver, or the appearance of such person or persons at such meeting in person or by proxy, shall be deemed equivalent to such notice.

5.4 Actions with Respect to Securities of Other Corporations. Except as the Board of Directors may otherwise designate, the Chief Executive Officer or President or any officer of the corporation authorized by the Chief Executive Officer or President shall have the power to vote and otherwise act on behalf of the corporation, in person or proxy, and may waive notice of, and act as, or appoint any person or persons to act as, proxy or attorney-in-fact to this corporation (with or without power of substitution) at any meeting of stockholders or shareholders (or with respect to any action of stockholders) of any other corporation or organization, the securities of which may be held by this corporation and otherwise to exercise any and all rights and powers which this corporation may possess by reason of this corporation’s ownership of securities in such other corporation or other organization.

5.5 Evidence of Authority. A certificate by the Secretary, or an Assistant Secretary, or a temporary Secretary, as to any action taken by the stockholders, directors, a committee or any officer or representative of the corporation shall as to all persons who rely on the certificate in good faith be conclusive evidence of such action.

5.6 Certificate of Incorporation. All reference in these Bylaws to the Certificate of Incorporation shall be deemed to refer to the Certificate of Incorporation of the corporation, as amended and in effect from time to time.

5.7 Severability. Any determination that any provision of these Bylaws is for any reason inapplicable, illegal or ineffective shall not affect or invalidate any other provision of these Bylaws.

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5.8 Pronouns. All pronouns used in these Bylaws shall be deemed to refer to the masculine, feminine or neuter, singular or plural, as the identity of the person or persons may require.

5.9 Notices. Except as otherwise specifically provided herein or required by law, all notices required to be given to any stockholder, director, officer, employee or agent shall be in writing and may in every instance be effectively given by hand delivery to the recipient thereof, by depositing such notice in the mails, postage paid, or by sending such notice by facsimile or other electronic transmission in the manner provided in Section 232 of the Delaware General Corporation Law, or by commercial courier service. Any such notice shall be addressed to such stockholder, director, officer, employee or agent at his or her last known address as the same appears on the books of the corporation. The time when such notice shall be deemed to be given shall be the time such notice is received by such stockholder, director, officer, employee or agent, or by any person accepting such notice on behalf of such person, if delivered by hand, facsimile, other electronic transmission or commercial courier service, or the time such notice is dispatched, if delivered through the mails.

5.10 Reliance Upon Books, Reports and Records. Each director, each member of any committee designated by the Board of Directors, and each officer of the corporation shall, in the performance of his duties, be fully protected in relying in good faith upon the books of account or other records of the corporation, including reports made to the corporation by any of its officers, by an independent certified public accountant, or by an appraiser selected with reasonable care.

5.11 Time Periods. In applying any provision of these Bylaws which require that an act be done or not done a specified number of days prior to an event or that an act be done during a period of a specified number of days prior to an event, calendar days shall be used, the day of the doing of the act shall be excluded, and the day of the event shall be included.

5.12 Facsimile Signatures. In addition to the provisions for use of facsimile signatures elsewhere specifically authorized in these Bylaws, facsimile signatures of any officer or officers of the corporation may be used whenever and as authorized by the Board of Directors or a committee thereof.

5.13 Annual Report. For so long as the corporation has fewer than 100 holders of record of its shares, the mandatory requirement of an annual report under Section 1501 of the California Corporations Code is hereby expressly waived.

ARTICLE VI

AMENDMENTS

6.1 By the Board of Directors. Except as is otherwise set forth in these Bylaws, these Bylaws may be altered, amended or repealed or new Bylaws may be adopted by the affirmative vote of a majority of the directors present at any regular or special meeting of the Board of Directors at which a quorum is present.

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6.2 By the Stockholders. Except as otherwise set forth in these Bylaws, these Bylaws may be altered, amended or repealed or new Bylaws may be adopted by the affirmative vote of the holders of at least a majority of the shares of the capital stock of the corporation issued and outstanding and entitled to vote at any annual meeting of stockholders, or at any special meeting of stockholders, provided notice of such alteration, amendment, repeal or adoption of new Bylaws shall have been stated in the notice of such special meeting.

ARTICLE VII

INDEMNIFICATION OF DIRECTORS AND OFFICERS

7.1 Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (“proceeding”), by reason of the fact that he or she or a person of whom he or she is the legal representative, is or was a director or officer of the corporation or is or was serving at the request of the corporation as a director or officer of another corporation, or as a controlling person of a partnership, joint venture, trust or other enterprise, including service with respect to employee benefit plans, whether the basis of such proceeding is alleged action in an official capacity as a director or officer, or in any other capacity while serving as a director or officer, shall be indemnified and held harmless by the corporation to the fullest extent authorized by the Delaware General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the corporation to provide broader indemnification rights than said Law permitted the corporation to provide prior to such amendment) against all expenses, liability and loss reasonably incurred or suffered by such person in connection therewith and such indemnification shall continue as to a person who has ceased to be a director or officer and shall inure to the benefit of his or her heirs, executors and administrators; provided, however, that except as provided in Section 7.2 of this Article VII, the corporation shall indemnify any such person seeking indemnity in connection with a proceeding (or part thereof) initiated by such person only if (a) such indemnification is expressly required to be made by law, (b) the proceeding (or part thereof) was authorized by the Board of Directors of the corporation, (c) such indemnification is provided by the corporation, in its sole discretion, pursuant to the powers vested in the corporation under the Delaware General Corporation Law, or (d) the proceeding (or part thereof) is brought to establish or enforce a right to indemnification under an indemnity agreement or any other statute or law or otherwise as required under Section 145 of the Delaware General Corporation Law. The rights hereunder shall be contract rights and shall include the right to be paid expenses incurred in defending any such proceeding in advance of its final disposition; provided, however, that, unless the Delaware General Corporation Law then so prohibits, the payment of such expenses incurred by a director or officer of the corporation in his or her capacity as a director or officer (and not in any other capacity in which service was or is tendered by such person while a director or officer, including, without limitation, service to an employee benefit plan) in advance of the final disposition of such proceeding, shall be made only upon delivery to the corporation of an undertaking, by or on behalf of such director or officer, to repay all amounts so advanced if it should be determined ultimately that such director or officer is not entitled to be indemnified under this Section or otherwise.

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7.2 Right of Claimant to Bring Suit. If a claim under Section 7.1 is not paid in full by the corporation within 90 days after a written claim has been received by the corporation, the claimant may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim and, if such suit is not frivolous or brought in bad faith, the claimant shall be entitled to be paid also the expense of prosecuting such claim. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending any proceeding in advance of its final disposition where the required undertaking, if any, has been tendered to this corporation) that the claimant has not met the standards of conduct which make it permissible under the Delaware General Corporation Law for the corporation to indemnify the claimant for the amount claimed. Neither the failure of the corporation (including its Board of Directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that claimant has not met the applicable standard of conduct.

7.3 Indemnification of Employees and Agents. The corporation may, to the extent authorized from time to time by the Board of Directors, grant rights to indemnification, and to the advancement of related expenses, to any employee or agent of the corporation to the fullest extent of the provisions of this Article with respect to the indemnification of and advancement of expenses to directors and officers of the corporation.

7.4 Non-Exclusivity of Rights. The rights conferred on any person in Sections 7.1 and 7.2 shall not be exclusive of any other right which such persons may have or hereafter acquire under any statute, provision of the Certificate of Incorporation, bylaw, agreement, vote of stockholders or disinterested directors or otherwise.

7.5 Indemnification Contracts. The Board of Directors is authorized to enter into a contract with any director, officer, employee or agent of the corporation, or any person serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, including employee benefit plans, providing for indemnification rights equivalent to or, if the Board of Directors so determines, greater than, those provided for in this Article VII.

7.6 Insurance. The corporation may maintain insurance to the extent reasonably available, at its expense, to protect itself and any such director, officer, employee or agent of the corporation or another corporation, partnership, joint venture, trust or other enterprise against any such expense, liability or loss, whether or not the corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law.

7.7 Effect of Amendment. Any amendment, repeal or modification of any provision of this Article VII by the stockholders and the directors of the corporation shall not adversely affect any right or protection of a director or officer of the corporation existing at the time of such amendment, repeal or modification.

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EX-4.1

Exhibit 4.1

PROFESSOR CONNOR’S, INC.

COMMON STOCK WARRANT AGREEMENT

This COMMON STOCK WARRANT AGREEMENT (the “Agreement”) is dated as of October 5, 2007, and entered into by and between PROFESSOR CONNOR’S, INC., a Delaware corporation (the “Company”), and CITY NATIONAL BANK, a national banking association (“CNB” or the “Warrant Holder”). (The Warrant (as hereinafter defined) may be transferred to one or more transferees in whole or in part from time to time; accordingly in the event of such a transfer, “Warrant Holder” shall mean each and every holder of the Warrant, or any part thereof, from time to time). Capitalized terms not otherwise defined shall have the meaning ascribed to them in the Loan Agreement (as defined below).

RECITALS

WHEREAS, pursuant to that certain Loan and Security Agreement of even date herewith (as the same may from time to time be amended, supplemented or extended, the “Loan Agreement”) by and among the Company and CNB, CNB has agreed to extend credit to the Company (the “Loan Transaction”);

WHEREAS, in connection with the Loan Transaction, and in consideration thereof, the Company is issuing to the Warrant Holder a warrant (the “Warrant”) to purchase up to an aggregate of 82,634 shares of voting common Stock of the Company (the “Common Stock”), subject to adjustment pursuant to Section 8 hereof, representing one and a quarter percent (1.25%) of the number of shares of Common Stock, calculated on a fully diluted basis (excluding the Excluded Plan Stock (as defined below in Section 8(e)), as of the date hereof (the Common Stock issuable on exercise of the Warrant being referred to herein as the “Warrant Shares”), at the exercise price per share provided for herein, which Warrant shall be evidenced in substantially the same form as the Form of Warrant Certificate attached hereto as Exhibit A; and

WHEREAS, the Warrant Holder desires to acquire from the Company, and the Company desires to issue to the Warrant Holder, the Warrant.

AGREEMENT

NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereto agree as follows:

Section 1. Issuance and Acquisition of Warrant. In consideration for the extension of credit by the Lender to the Company, the Company hereby agrees to issue to the Warrant Holder, subject to the conditions and restrictions contained in this Agreement, and the Warrant Holder hereby agrees to acquire from the Company, the Warrant.

Section 2. Warrant Certificate. The certificate evidencing the Warrant (the “Warrant Certificate”) to be delivered pursuant to this Agreement shall be in registered form only and shall be substantially in the form set forth in Exhibit A attached hereto. The Company shall number and register the Warrant in a register as it is issued.

Section 3. Registration of Transfers and Exchanges.

(a) In connection with any Transfer (as defined below) of the Warrant or any Warrant Shares, the Warrant Holder shall, if required by the Company, obtain from counsel to such holder (who shall be reasonably satisfactory to the Company) an opinion that the proposed Transfer of such Warrant or Warrant Shares may be effected without registration under the Securities Act of 1933, as amended (the “Securities Act”) and any applicable state securities law. Each Warrant, each Warrant Certificate and any Warrant Shares issued upon such Transfer shall bear the restrictive legends set forth on the Warrant Certificate, unless with respect to the legend, in the opinion of such counsel such legend is not required in order to ensure compliance with the Securities Act and any applicable state securities laws. As used herein, “Transfer” means to sell, assign, transfer, pledge, hypothecate, mortgage, encumber, dispose by gift or bequest, or otherwise transfer or dispose.

(b) Subject to Section 3(a) hereof, the Company shall from time to time register the Transfer of the Warrant in a Warrant register to be maintained by the Company upon surrender of such Warrant Certificate accompanied by a written
instrument(s) of such Transfer in form satisfactory to the Company, duly executed by the registered holder(s) thereof or by the duly appointed legal representative thereof or by a duly authorized attorney and delivery, in writing, of the agreement of the proposed transferee to be bound by the terms of this Agreement. Upon any such registration of Transfer, a new Warrant Certificate shall be issued to the transferee(s) and the surrendered Warrant Certificate shall be canceled and disposed of by the Company. Warrant Certificate(s) may be exchanged at the option of the holder(s) thereof, when surrendered to the Company at its office for another Warrant Certificate or other Warrant Certificates of like tenor and representing in the aggregate a like number of Warrant Shares. Warrant Certificates surrendered for exchange shall be canceled and disposed of by the Company.

Section 4. Exercise of Warrant.

(a) Subject to the terms of this Agreement, the Warrant Holder shall have the right, which may be exercised commencing on the date of this Agreement and until 5:00 p.m., Los Angeles time on the tenth anniversary of the date of the Warrant (the “Exercise Period”), to purchase from the Company the number of fully paid and nonassessable Warrant Shares which the holder may at the time be entitled to purchase upon exercise of such Warrant and payment to the Company of the Exercise Price (as defined in Section 4(c) hereof) per Warrant Share then in effect. In the alternative, the Warrant Holder may exercise its right, during the Exercise Period, to purchase Warrant Shares on a net basis, such that, without the exchange of any funds, such holder purchases that number of Warrant Shares otherwise issuable (or purchasable) upon exercise of its Warrant less that number of Warrant Shares having a Current Market Price (as defined in Section 8(h) hereof) at the time of exercise equal to the aggregate Exercise Price that would otherwise have been paid by such holder upon the exercise of the Warrant.

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(b) No fractional shares shall be issued upon the exercise of the Warrant (or any portion thereof). All Warrant Shares (including fractions thereof) issuable upon exercise of the Warrant (or fraction thereof) by a holder thereof shall be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional share. If, after the aforementioned aggregation, the exercise would result in the issuance of a fraction of a share of Common Stock, the Company shall, in lieu of issuing any fractional share, pay the holder otherwise entitled to such fraction a sum in cash equal to the Current Market Price, multiplied by such fraction on the date of conversion.

(c) The Warrant may be exercised upon surrender to the Company at its office designated for such purpose (the address of which is set forth in Section 16 hereof) the Warrant Certificate(s) evidencing the Warrant to be exercised with the Notice of Exercise, substantially in the form attached hereto as Exhibit B duly filled in and signed, and upon payment to the Company of the exercise price per Warrant Share (the “Exercise Price”) which is set forth in the Warrant Certificate, subject to adjustment pursuant to Section 8 hereof, for the number of Warrant Shares in respect of which such Warrant is then exercised. Payment of the aggregate Exercise Price shall be made (i) in cash or by certified or official bank check payable to the order of the Company or wire transfer in immediately available funds to such account as shall be designated by the Company or (ii) in the manner provided in Section 4(a) hereof.

(d) Upon such surrender of the Warrant Certificate and payment of the aggregate Exercise Price by the holder thereof, the Company shall issue and cause to be delivered within three (3) business days to or upon the written order of the holder and in such name or names as the holder may designate, a certificate or certificates for the number of full Warrant Shares issuable upon the exercise of such Warrant. Subject to Sections 3(a) and 5 hereof, in the event the name or names so designated are not that of the holder, such certificate or certificates shall be deemed to have been issued and any person so designated to be named therein shall be deemed to have become a holder of record of such Warrant Shares as of the date of the exercise of such Warrant and payment of the Exercise Price.

(e) The Warrant shall be exercisable, at the election of the holder thereof, either in full or from time to time in part and, in the event that a Warrant is exercised in respect of fewer than all of the Warrant Shares issuable on such exercise at any time prior to the date of expiration of the Warrant, the Company shall, at the time of delivery of such certificate, deliver to such holder a new Warrant (evidenced by the appropriate new Warrant Certificate), which new Warrant shall in all other respects be identical with the Warrant exercised.

(f) The Warrant shall also be conditionally exercisable, at the election of the holder thereof, so that if the Warrant holder exercises the Warrant in contemplation of the consummation of a transaction described in any of clauses (i) - (iii) of Section 12(b) hereof and such transaction is not consummated, the holder of the Warrant may elect to revoke such exercise, in which case such Warrant shall be deemed not to have been so exercised.

(g) Any Warrant Certificate surrendered upon exercise of a Warrant shall be cancelled and disposed of by the Company. The Company shall keep copies of this Agreement and any notices given or received hereunder available for inspection by the holders during normal business hours at its offices.

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(h) In the event that any portion of this Warrant is unexercised at the end of the Exercise Period (the “Expiration Date”), such portion of this Warrant shall be deemed to have been exercised and converted automatically into Warrant Shares pursuant to the cashless exercise terms of Section 4(a) above immediately prior to 5:00 p.m. (Los Angeles time) on the Expiration Date (or, in the event that the Expiration Date is not a business day, at 5:00 p.m. (Los Angeles time) on the immediately preceding business day) (the “Automatic Conversion Date”) and the person entitled to receive the Warrant Shares issuable upon such conversion shall be treated for all purposes as the holder of record of such Warrant Shares as of the close of business (Los Angeles time) on such Automatic Conversion Date. This Warrant shall be deemed to be surrendered to the Company on the Automatic Conversion Date, by virtue of this Section 4(h) and without any action by the holder of this Warrant or any other person. As promptly as practicable on or after the Automatic Conversion Date and in any event within thirty (30) days thereafter, the Company at its expense shall issue and deliver to the person or persons entitled to receive the same a certificate or certificates for the number of Warrant Shares issuable upon such conversion.

Section 5. Payment of Taxes; Transfer Costs. The Company will pay all documentary stamp and transfer taxes attributable to the issuance of Warrant Shares upon exercise of the Warrant; provided, however, that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery of any Warrant Certificate or certificate representing any Warrant Shares other than to the holder of the Warrant immediately prior to such transfer or issuance.

Section 6. Lost, Mutilated or Missing Warrant Certificate. In case the Warrant Certificate is mutilated, lost, stolen or destroyed, the Company shall issue, in exchange and substitution for and upon cancellation of the mutilated Warrant Certificate, or in lieu of and substitution of the Warrant Certificate lost, stolen or destroyed, a new Warrant Certificate of like tenor and representing an equivalent number of Warrant Shares, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction of such Warrant Certificate and indemnity, if requested, also reasonably satisfactory to it.

Section 7. Reservation of Warrant Shares. The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the exercise of the Warrant, a number of shares equal to the number of its shares of Common Stock as shall from time to time be sufficient to effect the exercise of the entire Warrant at the then applicable Exercise Price, and if at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the exercise of the entire Warrant, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose, including, without limitation, engaging in best efforts to obtain the requisite stockholder approval. The Company or, if appointed, the transfer agent for the Common Stock (the “Transfer Agent”) and every subsequent transfer agent for any shares of the Company’s capital stock issuable upon the exercise of any of the rights of purchase aforesaid will be irrevocably authorized and directed at all times to reserve such number of authorized shares as shall be required for such purpose. The Company will keep a copy of this Agreement on file with the Transfer Agent and with every subsequent transfer agent for any shares of the Company’s capital stock issuable upon the exercise of the rights of purchase

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represented by the Warrant. The Company will furnish such Transfer Agent a copy of all notices of adjustments and certificates related thereto transmitted to each holder pursuant to Section 8 hereof to reduce the Exercise Price. The Company shall take any corporate action which may, in the opinion of its counsel, be necessary in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares at the Exercise Price as so adjusted. The Company covenants that all Warrant Shares which may be issued upon exercise of the Warrant will, upon issue, be fully paid, nonassessable, free of preemptive rights and free from all taxes, liens, charges and security interests with respect to the issue thereof. If and so long as the outstanding shares of Common Stock may be listed on any securities exchange in the United States, the Company shall use its reasonable best efforts to cause all Warrant Shares reserved for issuance upon exercise of the Warrant to be listed on each such exchange upon official notice of issuance upon such exercise.

Section 8. Adjustment of Exercise Price and Number of Warrant Shares Issuable. The Exercise Price and the number of Warrant Shares issuable upon the exercise of the Warrant are subject to adjustment from time to time upon the occurrence of the events enumerated in this Section 8; provided, however, notwithstanding anything to the contrary contained herein, in no event shall (i) the Exercise Price be adjusted to be below the then current par value of the Company Stock or (ii) any event result in the adjustment to the Exercise Price pursuant to more than one subsection of this Section 8. After each such adjustment, the calculated adjusted Exercise Price shall become the current Exercise Price for any subsequent adjustment (if any) of the Exercise Price. For purposes of this Section 8. “Common Stock” means shares of now or hereafter authorized common stock of the Company.

(a) Adjustment for Initial Errors. The Company hereby acknowledges that the number of Warrant Shares constituting the initial number of securities purchasable upon the exercise of the Warrant was based upon the Company’s representations as to the amount of outstanding Common Stock as of the date hereof, as set forth in Section 13a(iii) below, and upon an intention that the full exercise of the Warrant would result in the holder obtaining shares of Common Stock equal to one and a quarter percent (1.25%) of the number of shares of the Common Stock, calculated on a fully diluted basis (excluding the Excluded Plan Stock (as defined below in Section 8(e)), as of the date hereof. If for any reason it shall hereafter be determined that the actual amount of Common Stock, calculated on a fully diluted basis, as of the date hereof caused the calculation of the Warrant Shares to be erroneous, then the Company or the holder (whichever shall discover such error) shall notify the other of such determination and the Company shall forthwith amend and reissue this Warrant (evidenced by the appropriate new Warrant Certificate) with an appropriate proportional adjustment in said number to be effective from the date hereof.

(b) Adjustment for Change in Capital Stock. If the Company (1) pays a dividend or makes a distribution on its Common Stock in shares of its Common Stock, (2) subdivides its outstanding shares of Common Stock into a greater number of shares, or (3) combines its outstanding shares of Common Stock into a smaller number of shares, then the Exercise Price shall be adjusted in accordance with the formula:

E¹ = E * (O/A)

where:

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E1	=	the adjusted Exercise Price.
E	=	the current Exercise Price.
O	=	the number of shares of Common Stock outstanding prior to such action.
A	=	the number of shares of Common Stock outstanding immediately after such action.

In the case of such dividend or distribution, the adjustment shall become effective immediately after the record date for determination of the holders of shares of Common Stock who are entitled to receive such dividend or distribution, and in the case of such subdivision, combination or reclassification, the adjustment shall become effective immediately after the effective date of such corporate action. If after an adjustment the holder of the Warrant upon exercise thereof may receive shares of two or more classes of capital stock of the Company, the Board shall determine in good faith the allocation of the adjusted Exercise Price between the classes of capital stock. After such allocation, the exercise privilege, the number of shares issuable upon such exercise and the Exercise Price of each class of capital stock shall thereafter be subject to adjustment on terms comparable to those applicable to Common Stock in this Section 8. The adjustment required by this Section 8(b) shall be made successively whenever any event listed above shall occur.

(c) Adjustment for Rights Issue. If the Company distributes (other than pursuant to, or as specifically excluded from, Sections 8(d) or 8(f) hereof) any rights, options or warrants to the holders of any series or class of its Common Stock entitling such holders thereof at any time after the record date mentioned below to purchase shares of Common Stock at a price per share less than the greater of the Current Market Price or the Exercise Price per share on that record date, the Exercise Price shall be reduced to the price determined in accordance with the formula:

E¹ = E * ((O + (N * P) /M) / (O + N))

where:

E1	=	the adjusted Exercise Price.
E	=	the current Exercise Price.
O	=	the number of shares of Common Stock outstanding prior to such action.
N	=	the number of additional shares of Common Stock issuable upon exercise of the rights, options or warrants offered.
P	=	the exercise price per share of additional shares issuable upon exercise of the rights, options or warrants.

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M = the greater of the Current Market Price or the Exercise Price per share of Common Stock on the record date.

The adjustment shall be made successively whenever any such rights, options or warrants are issued and shall become effective immediately after the record date for the determination of stockholders entitled to receive such rights, options or warrants. If (i) at the end of the period during which such rights, options or warrants are exercisable, not all rights, options or warrants shall have been exercised, or (ii) at any time the exercise price per share for which shares of Common Stock are issuable pursuant to such rights, options or warrants shall be increased or decreased solely by virtue of provision therein contained for an automatic increase or decrease in such exercise price per share upon the occurrence of a specified date or event, then the Exercise Price shall be immediately readjusted to what it would have been if, in the case of clause (i) above, “N” in the above formula had been the number of shares actually issued or, in the case of clause (ii) above, “P” in the above formula had been the exercise price per share, as so increased or decreased, as the case may be.

(d) Adjustment for Distribution. If the Company distributes (including by way of share repurchases to the extent in excess of the Current Market Price per share but not including payments to any such holder in a capacity other than as a holder of any equity securities of the Company) to the holders of any series or class of its Common Stock any of its assets (other than cash), debt securities, preferred stock, or any rights or warrants to purchase debt securities, preferred stock, assets or other securities of the Company (other than Common Stock), the Exercise Price shall be adjusted in accordance with the formula:

E^{1 =} E* ((M – F ) / M)

where:

E1	=	the adjusted Exercise Price.
E	=	the current Exercise Price.
M	=	the Current Market Price per share of Common Stock on the record date mentioned below.
F	=	the Fair Market Value (as defined in Section 8(h)) of the assets, securities, rights or warrants distributed with respect to one share of Common Stock) on the record date of such distribution.

The adjustment shall be made successively whenever any such distribution is made and shall become effective immediately after the record date for the determination of stockholders entitled to receive the distribution. This Section 8(d) does not apply to rights, options or warrants referred to in Sections 8(c) or 8(f) hereof.

(e) Adjustment for Below Market Issuance of Common Stock and Common Units. If the Company issues shares of its Common Stock for a consideration per share less than the greater of the Current Market Price or the Exercise Price per share on the date the Company fixes the offering price of such additional shares, or if the Company (i) issues stock

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options to its management or (ii) grants rights to its management in a phantom stock plan, stock appreciation rights plan or similar plan that compensates management on the basis of the value of a share of Common Stock (in each such case described in clauses (i) and (ii), “Plan Stock”; with Plan Stock issued by the Company to management of the Company pursuant to stock option plans and incentive plans in effect as of the date hereof and representing in the aggregate up to 844,137 shares of Common Stock of the Company being referred to as the “Excluded Plan Stock”), the Exercise Price shall be reduced to the price determined in accordance with the formula:

E¹ = E * ((O + P/M)/A)

where:

E1	=	the adjusted Exercise Price.
E	=	the current Exercise Price.
O	=	the aggregate number of shares of Common Stock and Plan Stock (in each case other than Excluded Plan Stock) outstanding immediately prior to the issuance of such additional shares.
P	=	the aggregate consideration received for the issuance of such additional shares of Common Stock or Plan Stock (in each case other than Excluded Plan Stock).
M	=	the greater of the Current Market Price or the Exercise Price per share of Common Stock on the date of issuance of such additional shares of Common Stock or Plan Stock (in each case other than Excluded Plan Stock).
A	=	the aggregate number of shares of Common Stock and Plan Stock (in each case other than Excluded Plan Stock) outstanding immediately after the issuance of such additional shares.

The adjustment shall be made successively whenever any such issuance is made, and shall become effective immediately after such issuance. This Section 8(e) does not apply to: (1) any of the transactions described in Section 8(b), 8(c), 8(f) or 8(g) hereof (for which an appropriate adjustment has already been made); (2) the exercise of the Warrant, or the conversion or exchange of other securities outstanding on the date of this Agreement that are convertible or exchangeable for Common Stock.

(f) Adjustment for Options, Warrants or Other Rights. If the Company issues any options, warrants or other rights to subscribe for or purchase any shares of Common Stock (other than securities issued in transactions described in Section 8(c) hereof and other than Common Units) and the consideration per share for which shares of Common Stock at any time thereafter may be issuable pursuant to such warrants, options or other rights shall be less than the greater of the Exercise Price or the Current Market Price per share on the

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Computation Date (as defined below), then the Exercise Price shall be adjusted as provided in Section 8(e) hereof. Such adjustment shall be made on the basis that (i) the maximum number of shares of Common Stock issuable pursuant to all such warrants, options or other rights or necessary to effect the conversion, exercise or exchange of all warrants, options or other rights shall be deemed to have been issued as of the Computation Date and (ii) the aggregate consideration for such maximum number of shares of Common Stock shall be deemed to be the minimum consideration received and receivable by the Company for the issuance of such shares of Common Stock pursuant to such warrants, options or other rights. The term “Computation Date” shall mean the date of issuance of such warrant, options or other rights. If (i) at the end of the period during which such rights, options or warrants are exercisable, not all rights, options or warrants shall have been exercised or, during such period, they have lapsed, been terminated or been canceled, or (ii) at any time the exercise price per share for which shares of Common Stock are issuable pursuant to such rights, options or warrants shall be increased or decreased solely by virtue of a provision therein contained for an automatic increase or decrease in such exercise price per share upon the occurrence of a specified date or event, then the Exercise Price shall be immediately readjusted to what it would have been if, in the case of clause (i) above, “A” in the formula in Section 8(e) had been calculated based on the number of shares actually issued or, in the case of either clause (i) or clause (ii) above, “P” in the formula in Section 8(e) had been the actual aggregate consideration received for the issuance of such additional shares.

(g) Adjustment for Convertible Securities Issues. If the Company issues any securities convertible into or exchangeable for Common Stock (other than securities issued in transactions described in Sections 8(c), 8(d) or 8(f) hereof and other than Common Units) for a consideration per share of Common Stock initially deliverable upon conversion or exchange of such securities less than the greater of the Current Market Price or the Exercise Price per share on the date of issuance of such securities, the Exercise Price shall be reduced to the price determined in accordance with this formula:

E¹ = E * ((O +P/M)/(O+D))

where:

E1	=	the adjusted Exercise Price.
E	=	the current Exercise Price.
O	=	the number of shares of Common Stock outstanding immediately prior to the issuance of such shares.
P	=	the aggregate consideration received upon issuance of the securities or receivable for the issuance of such shares upon conversion or exchange (based on the initial conversion or exchange rate).

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M	=	the greater of the Current Market Price or the Exercise Price per share on the date of issuance of such securities.
D	=	the maximum number of Common Stock deliverable upon conversion or in exchange for such securities at the initial conversion or exchange rate.

The adjustment shall be made successively whenever any such issuance is made, and shall become effective immediately after such issuance. If (i) all of the Common Stock deliverable upon conversion or exchange of such securities have not been issued when such securities are no longer outstanding, or (ii) the exercise price per share for which shares of Common Stock are issuable pursuant to such securities shall be increased or decreased solely by virtue of provisions therein contained for an automatic increase or decrease in such exercise price per share upon the occurrence of a specified date or event, then the Exercise Price shall promptly be readjusted to the Exercise Price which would then be in effect had the adjustment upon the issuance of such securities been made on the basis of, in the case of clause (i) above, the actual number of shares of Common Stock issued upon conversion or exchange of such securities or, in the case of clause (ii) above, the exercise price per share, as so increased or decreased, as the case may be.

(h) Certain Definitions.

(1) Current Market Price. The “Current Market Price” per share of Common Stock on any date is:

(i) if the Common Stock is not registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), then the Fair Market Value per share of the Common Stock based upon the Fair Market Value of one hundred percent (100%) of the Company if sold as a going concern and without regard to any discount for the lack of liquidity or on the basis that the relevant shares of the Common Stock do not constitute a majority or controlling interest in the Company and assuming, if applicable, the exercise or conversion of all “in-the-money” warrants, convertible securities, options or other rights to subscribe for or purchase any additional shares of capital stock of the Company or securities convertible or exchangeable into such capital stock; or

(ii) if the Common Stock is registered under the Exchange Act, the average of the closing prices per share of the Common Stock for thirty (30) consecutive trading days commencing forty-five (45) trading days before the date in question. The term “closing price” of the Common Stock on any day, as indicated in the next day’s Wall Street Journal if so reported in the Wall Street Journal (or if not reported in the Wall Street Journal, as reported by National Quotation Bureau Incorporated or, if not so reported, by a nationally recognized

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quotation service), shall be (A) the reported closing price (last sale price) of the Common Stock on the principal stock exchange on which the Common Stock is listed, (B) if the Common Stock is not listed on a stock exchange, the reported closing price of the Common Stock on the principal automated securities price quotation system on which sale prices of the Common Stock are reported, or (C) if the Common Stock is not listed on a stock exchange and sale prices of the Common Stock are not reported on an automated quotation system, the mean of the final bid and asked prices for the Common Stock as reported by National Quotation Bureau Incorporated if at least two (2) securities dealers have inserted both bid and asked quotations for the Common Stock on at least five (5) of the ten (10) preceding trading days. If none of the foregoing provisions are applicable, the Current Market Price shall be determined in accordance with Section 8(h)(1)(i) hereof. The term “trading day” shall mean (X) if the Common Stock is listed on at least one stock exchange, a day on which there is trading on the principal stock exchange on which the Common Stock is listed, (Y) if the Common Stock is not listed on a stock exchange but sale prices of the Common Stock are reported on an automated quotation system, a day on which trading is reported on the principal automated quotation system on which sales of the Common Stock are reported, or (Z) if the foregoing provisions are inapplicable, a day on which quotations are reported by National Quotation Bureau Incorporated.

(2) Fair Market Value. The term “Fair Market Value” means the value (“Valuation”) obtainable upon a sale in an arm’s length transaction to a third party under usual and normal circumstances, with neither the buyer nor the seller under any compulsion to act, with equity to both, as determined by the Board of Directors of the Company (the “Board”) in good faith, which determination shall be described in a duly adopted Board resolution certified by the Company’s Secretary or Assistant Secretary. If the Board is unable to determine any Valuation, or if the holders of at least fifty-one percent (51%) of all of the Warrant Shares then issuable hereunder (collectively, the “Requesting Holders”) disagree with the Board’s determination of any Valuation by written notice delivered to the Company within thirty (30) days after the determination thereof by the Board is communicated to the Warrant Holders affected thereby, which notice specifies a majority-in-interest of the Requesting Holders’ determination of such Valuation, then following a thirty day period in which Company and Requesting Holders shall attempt to resolve the differences in the Valuation determination, the Company and a majority-in-interest of the Requesting Holders shall select a mutually acceptable investment banking firm of national reputation which has not had a material relationship with the Company, the Warrant Holder or any director or officer thereof within the preceding two (2) years, which

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shall determine such Valuation. Such investment banking firm’s determination of such Valuation shall be final, binding and conclusive on the Company and the holders of all of the Warrants issued hereunder and then outstanding. Any and all costs and fees of such investment banking firm shall be borne by the Company.

(i) Consideration Received. For purposes of any computation respecting consideration received pursuant to Sections 8(e), 8(f) and 8(g) hereof, the following shall apply:

(1) in the case of the issuance of shares of Common Stock for cash, the consideration shall be the amount of such cash;

(2) in the case of the issuance of shares of Common Stock for a consideration in whole or in part other than cash, the consideration other than cash shall be deemed to be the Fair Market Value thereof; and

(3) in the case of the issuance of options, warrants, rights or other securities convertible into or exchangeable for shares, the aggregate consideration received therefor shall be deemed to be the consideration received by the Company for the issuance of such securities plus the additional minimum consideration, if any, to be received by the Company upon the conversion or exchange thereof (the consideration in each case to be determined in the same manner as provided in clauses (1) and (2) of this Section 8(i)).

(j) Notice of Adjustment. Whenever the Exercise Price is adjusted, the Company shall provide the notices required by Section 12 hereof.

(k) [Intentionally omitted]

(l) Reorganization of the Company. If any capital reorganization or reclassification of the capital stock of the Company, any consolidation or merger of the Company with another entity, or the sale or lease of all or substantially all of the Company’s assets to another entity shall be effected in such a way that holders of Common Stock of the Company shall be entitled to receive stock, securities or assets with respect to or in exchange for such Common Stock, then, as a condition precedent to such reorganization, reclassification, consolidation, merger, sale or lease, lawful and adequate provisions shall be made whereby the holder of the Warrant shall thereafter have the right to purchase and receive such stock, securities or assets upon the basis and the terms and conditions specified in this Agreement and in lieu of the shares of Common Stock immediately theretofore purchasable and receivable upon the exercise of the rights represented hereby had such rights been exercised immediately prior thereto, and in any such case appropriate provision shall be made with respect to the rights and interests of the holder of the Warrant to the end that the provisions hereof (including, without limitation, provisions for adjustments of the Exercise Price and of the number of shares of Common Stock purchasable and receivable upon the exercise of the Warrant) shall thereafter be applicable, as nearly as may be, in relation to any shares of stock, securities or assets thereafter

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deliverable upon the exercise hereof. The Company will not effect any such consolidation, merger, sale or lease, unless prior to the consummation thereof the successor corporation (if other than the Company) resulting from such consolidation or merger or the corporation purchasing or leasing such assets shall assume by written instrument, executed and mailed or delivered to the holder of the Warrant at the last address thereof appearing on the books of the Company, the obligation to deliver to such holder, such shares of stock, securities or assets as, in accordance with the foregoing provisions, such holder may be entitled to purchase.

(m) Adjustment in Number of Shares. In the event that the Exercise Price is adjusted pursuant to this Section 8 or would have been adjusted pursuant to this Section 8 but for clause (i) of the proviso in the first sentence of this Section 8, the Warrant shall thereafter evidence the right to receive upon payment of the then current Exercise Price that number of shares of Common Stock (calculated to the nearest hundredth) obtained from the following formula:

N1 = N * (E/E1)

where:

N1	=	the adjusted number of Warrant Shares issuable upon exercise of the Warrant by payment of the adjusted Exercise Price.
N	=	the number of Warrant Shares previously issuable upon the exercise of the Warrant by payment of the Exercise Price prior to adjustment.
E1	=	the Exercise Price as adjusted pursuant to Section 8 or as would have been adjusted pursuant to this Section 8 but for clause (i) of the proviso in the first sentence of this Section 8, as the case may be.
E	=	the Exercise Price prior to the adjustment or such event which would have resulted in an adjustment to the Exercise Price pursuant to this Section 8 but for clause (i) of the proviso in the first sentence of this Section 8.

(n) Form of Warrant. Irrespective of any adjustments in the Exercise Price or the number or kind of shares purchasable upon the exercise of the Warrant, any Warrant theretofore or thereafter issued may continue to express the same price and number and kind of shares as are stated in the Warrant initially issuable pursuant to this Agreement.

(o) Other Action Affecting Common Stock. In case at any time or from time to time the Company shall take any action affecting the Common Stock, other than an action described in this Section 8, then, unless in the reasonable opinion of the Board such action will not have an adverse effect upon the rights of the holder of the Warrant, the Exercise Price and the number of Warrant Shares purchasable and issuable upon the exercise of such Warrant shall be adjusted in such manner and at such time as the Board may in good faith determine to be equitable in the circumstances.

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(p) Excluded Transactions. Notwithstanding the preceding provisions of this Section 8, no adjustment of the Exercise Price or number of Warrant Shares shall be made with respect to any issuance of Common Stock upon the exercise or conversion of any warrants, options or convertible securities outstanding on the date hereof other than as required under Section 8(a).

Section 9. Cash Dividends. At each time that the Company pays a dividend in cash or makes a distribution in cash on its Common Stock, concurrently therewith, the Company shall pay to the Warrant Holder its pro rata share of any such dividend or distribution based upon the relative percentage ownership represented by the Warrant Shares.

Section 10. Joinder Agreement. By its acceptance of the Warrant, the Warrant Holder acknowledges and agrees that, upon exercise of the Warrant, the Warrant Holder shall become a stockholder of the Company under the Amended and Restated Certificate of Incorporation for the Company, as amended (the “Certificate of Incorporation”), and shall become a Stockholder under the Stockholders Agreement for the Company, as amended (the “Stockholders Agreement”). As a condition to the exercise of the Warrant, the Warrant Holder will execute the Joinder Agreement in substantially the form attached hereto as Exhibit C. By its acceptance of this warrant, the Warrant Holder agrees to abide and comply with the restrictions on Transfer contained in the Stockholders Agreement.

Section 11. Covenants of the Company

(a) No Amendment of Certificate of Incorporation. Until the Warrant has been fully exercised or has expired in accordance with its terms, the Company shall not amend the certificate of incorporation of the Company in any manner that could reasonably be expected to cause the Company to be in breach of any of the terms of this Agreement or to otherwise hinder the Company’s performance hereunder without the prior written consent of the holders of at least fifty-one percent (51%) of the Warrant Shares then issuable hereunder.

(b) [Intentionally omitted]

(c) Financial Information. The Company will deliver to the Warrant Holder the financial statements described below:

(1) as soon as practicable, but in any event within 45 days after the end of each fiscal quarter of the Company, an unaudited consolidated balance sheet of the Company as at the end of such quarter and the related consolidated statements of income, shareholders’ equity, and cash flows of the Company for such quarter and for the period from the beginning of such fiscal year to the end of such quarter, in each case, prepared in accordance with GAAP (except for the lack of footnotes and subject to year-end audit adjustments and reclassifications), together with a certification by the chief executive officer, president, or financial officer of the Company that the information contained in such financial statements fairly presents the financial condition of the Company as of the date thereof (subject to year-end adjustments and reclassifications); and

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for the period from the beginning of the then current fiscal year to the end of such quarter, a comparison setting forth the corresponding figures from the prior year and from the budgeted or projected figures, all in reasonable detail and having been prepared in accordance with GAAP (except for the lack of footnotes and subject to year-end audit adjustments);

(2) as soon as practicable and in any event within 120 days after the end of each fiscal year, the consolidated balance sheet of the Company as at the end of such fiscal year and the related consolidated and consolidating statements of income, shareholders’ equity, and cash flows of the Company for such fiscal year, setting forth in each case in comparative form the consolidated figures for the previous fiscal year, and the corresponding figures from the budgeted or projected figures, all in reasonable detail and accompanied by a report thereon of independent and certified public accountants of recognized national standing, without any qualifications (including any (A) “going concern” or like qualification or exception, or (B) qualification or exception as to the scope of such audit), and contains statements to the effect that such financial statements present fairly the financial position of the Company as at the dates indicated and the results of their operations and cash flow for the periods indicated in conformity with GAAP applied on a basis consistent with prior years (except as otherwise stated therein) and that the examination by such accountants in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards;

(d) State Securities Laws. The Company hereby agrees to comply with all state securities or “blue sky” laws which might be applicable to the sale of the Warrant; provided, however, the Company shall not be required in connection therewith to qualify to do business in or to file a general consent to service of process in any jurisdiction wherein it would not but for the requirements of this Section 11(d).

Section 12. Notices to Warrant Holders.

(a) Upon any adjustment of the Exercise Price pursuant to Section 8 hereof, the Company shall promptly thereafter (i) prepare a certificate setting forth the Exercise Price after such adjustment and setting forth in reasonable detail the method of calculation and the facts upon which such calculations are based and setting forth the number of Warrant Shares (or portion thereof) issuable after such adjustment in the Exercise Price, upon exercise of the Warrant and payment of the adjusted Exercise Price, and (ii) cause to be given to the registered holder of the Warrant Certificate written notice of such adjustments. Where appropriate, such notice may be given in advance and included as a part of the notice required to be mailed under the other provisions of this Section 12.

(b) In the event (i) that the Company shall authorize the distribution to all holders of shares of common Stock of evidences of its indebtedness or assets (including without limitation ordinary quarterly cash dividends), (ii) of any consolidation or merger to which the Company is a party and for which approval of the stockholders of the Company is

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required or of the conveyance or transfer of substantially all of the properties and assets of the Company or its subsidiaries or of any reclassification or change of Common Stock issuable upon exercise of the Warrant (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination), or a tender offer or exchange offer made by the Company for shares of common Stock or any transaction or series of transactions in which more than 50% of the voting power of the Company is disposed of, or (iii) of the voluntary or involuntary dissolution, liquidation or winding up of the Company or any of its subsidiaries, the Company shall cause to be given to the registered holder of the Warrant Certificate, at least thirty (30) days prior to the applicable record date hereinafter specified, or promptly in the case of events for which there is no record date, a written notice stating, in each case as applicable, (A) the date as of which the persons to which such distribution are to be made is determined, (B) the date on which any such reclassification, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding up is expected to become effective or consummated, the principal terms thereof and the date as of which it is expected that holders of record of shares of common Stock shall be entitled to exchange such shares for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, conveyance, transfer, dissolution, liquidation or winding up, and (C) the initial expiration date set forth in any tender offer or exchange offer made by the Company for shares of common Stock.

(c) The Company shall distribute to the Warrant Holder copies of all notices, materials, annual and quarterly reports, proxy statements, information statements and any other documents distributed generally to the holders of shares of common Stock at such times and by such method as such documents are distributed to such holders of shares of common Stock. Nothing contained in this Agreement or in the Warrant Certificate, however, shall be construed as conferring upon the holder thereof the right to vote or to consent or to receive notice as a stockholder in respect of the meetings of stockholders or the election of the Board or any other matter, or any right whatsoever as a stockholder of the Company prior to the exercise of the Warrant.

(d) The Company shall deliver to the holder of the Warrant written notice of the expiration of the Exercise Period of such Warrant. Such notice shall be delivered by the Company not less than thirty (30) days but not more than sixty (60) days prior to the existing expiration date of the Exercise Period of such Warrant.

(e) In the event that the Company undertakes to (i) sell, lease, exchange, convey or otherwise dispose of all or substantially all of its property or business, or (ii) merge into or consolidate with any other corporation (other than a wholly-owned Subsidiary), or effect any transaction (including a merger or other reorganization) or series of related transactions, in which more than fifty percent (50%) of the voting power of the Company is disposed of, the Company will use its best efforts to provide at least thirty (30) days notice of the terms and conditions of the proposed transaction. The Company shall cooperate with the Warrant Holder in consummating the sale of this Warrant in connection with any such transaction.

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Section 13. The Company’s Representations and Warranties. The Company represents and warrants that:

(a) Organization, Powers, Good Standing and Subsidiaries.

(i) Organization and Powers. The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, and has all requisite corporate power and authority to own and operate its properties, to carry on its business as now conducted and proposed to be conducted, to enter into this Agreement, to issue the Warrant and to carry out the transactions contemplated hereby and thereby.

(ii) Good Standing. The Company is in good standing wherever necessary to carry on its present business and operations, except in jurisdictions in which the failure to be in good standing has not had and reasonably could not be expected to have a Material Adverse Effect (as defined in the Loan Agreement).

(iii) Capitalization. As of the date hereof, the authorized capital stock of the Company consists of (A) 17,000,000 shares of voting common Stock, with par value of $0.001 per share, of which 6,610,738 shares are outstanding, (B) 2,000,000 shares of non-voting common Stock, with par value of $0.001 per share, of which 0 shares are outstanding, (C) 6,000,000 shares of Preferred Stock, with par value of $0.001 per share, of which (1) 2,639,465 shares have been authorized and designated as “Series A Preferred Stock” and 2,638,388 shares are outstanding, and (2) 250,000 shares have been authorized and designated as “Series B Preferred Stock” and 112,160 shares are outstanding, and (D) 844,137 shares of Plan Stock outstanding. All such outstanding shares have been fully paid, validly issued and are nonassessable. As of the date hereof, the Company has duly authorized the issuance of, and reserved for issuance, the shares of its common Stock that are to be issued upon the exercise of the Warrant and, upon such exercise, payment and issuance in accordance with the Warrant, such shares of its Common Stock will be validly issued, fully paid, nonassessable shares free of preemptive rights other than such rights as are contained in the Investor Rights Agreement. The issuance and sale of the Warrant has been made in compliance with all applicable federal and state securities laws. Other than the Warrant, as of the date hereof there are no subscriptions, options, warrants, or calls relating to any shares of the Company’s capital stock, including any right of conversion or exchange under any outstanding security or other instrument. The Company is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital stock or any security convertible into or exchangeable for any of its capital stock.

(b) Authorization.

(i) Authorization. The execution, delivery, and performance of this Agreement and the Warrant, the issuance and delivery of the Common Stock upon the exercise of the Warrant, and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action by the Company.

(ii) No Conflict. The execution, delivery, and performance by the Company of this Agreement and the issuance and delivery of the Warrant and, in each case, the consummation of the transactions contemplated hereby and thereby, will not (A) violate the certificate of incorporation or bylaws of the Company, (B) violate any order,

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judgment, or decree of any court or other governmental agency binding on the Company except for violations which, individually or in the aggregate, could not be expected to have a Material Adverse Effect, (C) violate any provision of law applicable to the Company except for violations which, individually or in the aggregate, could not be expected to have a Material Adverse Effect, (D) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any contract of the Company or pursuant to which its properties are bound, other than conflicts, breaches, and defaults as to which waivers have been obtained on or prior to the date hereof, or which could not be expected to have a Material Adverse Effect, (E) result in or require the creation or imposition of any Lien (other than Permitted Encumbrances) upon the Company’s properties, or (F) require any approval or consent of any person or entity under any contract of the Company, except for such approvals or consents as have been or will be obtained on or before the date hereof.

(iii) Due Execution and Delivery; Binding Obligations. This Agreement has been duly executed and delivered by the Company. This Agreement is a legally valid and binding obligation of the Company in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally and subject to the availability of equitable remedies, whether considered in a proceeding at law or in equity.

(c) No Adjustment of Other Shares on Issuance. Neither the issuance nor the exercise of the Warrant will cause the rate at which any of the Company’s outstanding securities are ultimately convertible into Common Stock to change nor will such issuance or exercise invoke any “antidilution” feature of any of the Company’s outstanding securities or rights to purchase securities.

(d) Rule 144. After it has filed a registration statement pursuant to the requirements of Section 12 of the Exchange Act, relating to any class of equity securities of the Company, the Company will use its best efforts to file in a timely manner all reports required to be filed by it pursuant to the Exchange Act and, upon the request of the Warrant Holder, will furnish the Warrant Holder with such reports so that the Warrant Holder may effect routine dispositions of Warrant Shares pursuant to Rule 144 under the Act or any similar rule or regulations hereafter adopted by the Securities and Exchange Commission. Notwithstanding anything to the contrary contained in this Agreement, the Company may deregister under Section 12 of the Exchange Act if it is then permitted to do so pursuant to the Exchange Act and the rules and regulations thereunder.

Section 14. The Warrant Holder’s Representations and Warranties.

(a) This Agreement is made with Warrant Holder in reliance upon the Warrant Holder’s representations to the Company, which by the Warrant Holder’s execution of this Agreement, the Warrant Holder hereby confirms that, the Warrant Holder is purchasing the Warrant (and the Warrant Shares issuable upon exercise of the Warrant) for its own account for investment purposes only, not as a nominee or agent, and not with a view to, or for the resale in connection with, any “distribution” thereof for purposes of the Securities Act.

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(b) The Warrant Holder is aware of the Company’s business affairs and financial condition, and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Warrant (and the Warrant Shares issuable upon exercise of the Warrant). The Warrant Holder represents that it is experienced in evaluating and investing in private placement transactions of securities of companies in a similar stage of development and acknowledges that the Warrant Holder is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial and business matters that the Warrant Holder is capable of evaluating the merits and rights of the investment in the Warrant (and the Warrant Shares issuable upon exercise of the Warrant). The Warrant Holder is an “accredited investor”, as that term is defined in Rule 501 of Regulation D as promulgated under the Securities Act.

(c) The Warrant Holder understands that the Warrant (and the Warrant Shares upon exercise of the Warrant) has not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Warrant Holder’s investment intent as expressed herein. In this connection, the Warrant Holder understands that, in the view of the Securities and Exchange Commission (“SEC”), the statutory basis for such exemption may be unavailable if the Warrant Holder’s representation was predicated solely upon a present intention to hold these Securities for the minimum capital gains period specified under applicable tax laws, for a deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. The Warrant Holder has no such intention.

(d) The Warrant Holder further understands that the Warrant (and the Warrant Shares upon exercise of the Warrant) must be held indefinitely unless subsequently registered under the Securities Act or unless an exemption from registration is otherwise available. In addition, the Warrant Holder understands that the certificate evidencing the Warrant (and the Warrant Shares upon exercise of the Warrant) will be imprinted with the legend referred to in the Warrant under which the Warrant (and the Warrant Shares upon exercise of the Warrant) are being purchased.

(e) The Warrant Holder is aware of the provisions of Rule 144 and 144A, promulgated under the Securities Act, which, in substance, permit limited public resale of “restricted securities” acquired, directly or indirectly, from the issuer thereof (or from an affiliate of such issuer), in a non-public offering subject to the satisfaction of certain conditions, if applicable, including, among other things: The availability of certain public information about the Company, the resale occurring not less than one (1) year after the party has purchased and paid for the securities to be sold; the sale being made through a broker in an unsolicited “broker’s transaction” or in transactions directly with a market maker (as said term is defined under the Securities Exchange Act of 1934, as amended) and the amount of securities being sold during any three-month period not exceeding the specified limitations stated therein. The Warrant Holder is aware that the public information about the Company required by Rule 144 is not currently available and the Company has no present plans to make such information available.

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(e) The Warrant Holder further understands that there is no, and at the time it wishes to sell the Warrant (or any Warrant Shares issuable upon exercise of the Warrant) there may be no, public market upon which to make a sale of the Warrant (or any Warrant Shares issuable upon exercise of the Warrant), and that, even if such a public market then exists, the Company may not be satisfying the current public information requirements of Rule 144 and 144A, and that, in such event, the Warrant Holder may be precluded from selling the Securities under Rule 144 and 144A even if the one-year minimum holding period had been satisfied.

(f) The Warrant Holder further understands that in the event all of the requirements of Rule 144 and 144A are not satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rule 144 is not exclusive, the Staff of the SEC has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rule 144 will have a substantial burden or proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk.

Section 15. Confidentiality. The Warrant Holder acknowledges that the information received pursuant hereto may be confidential and for its use only, and it will not use such confidential information in violation of the Exchange Act or reproduce, disclose or disseminate such information to any other person (other than its employees or agents having a need to know the contents of such information, its attorneys and its partners and/or potential partners or potential transferees of the Warrant Shares that are under obligations of confidentiality), except in connection with the exercise of rights under this Agreement, unless the Company has made such information available to the public generally or such Warrant Holder is required to disclose such information by a governmental body; provided, however, in such event, such Warrant Holder shall provide the Company with prompt notice of such requirement and cooperate with the Company to seek any protection order or other remedy as the Company may reasonably request.

Section 16. Notices Generally. Any notice or other communication required or permitted to be given hereunder shall be in writing and shall be effective (a) upon hand delivery or delivery by telex, telecopy or facsimile at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours, where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address or upon actual receipt of such mailing, whichever shall first occur. The addresses for such communications shall be.

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(i) If to the Company:	Professor Connor’s, Inc.
(ii) If to the Warrant Holder:	City National Bank 555 South Flower Street, 16th Floor Los Angeles, CA 90071 Attention: Aaron Cohen Telefacsimile: (213) 673-9801
with a copy to:	Paul, Hastings, Janofsky & Walker LLP
	515 South Flower Street Twenty-Fifth Floor
	Los Angeles, CA 90071 Attn: John F. Hilson, Esq.
	Telefacsimile: (213) 996-3300

or at such other address as either party shall have specified by notice in writing.

Section 17. Successors and Assigns. Except as otherwise provided herein, this Agreement shall be binding upon and inure to the benefit of the parties and their successors and assigns. The Company may not assign this Agreement or any rights or obligations hereunder or under the Warrant without the prior written consent of the Warrant Holders representing at least a majority of the Warrant Shares (which consent may be withheld for any reason in the sole discretion of the Warrant Holders), except that the Company may assign this Agreement in connection with a transaction described in Section 12(b)(ii), provided that the Company is not released from any of its obligations hereunder, and such assignee assumes all obligations of the Company hereunder, and appropriate adjustment of the provisions contained in this Agreement and in the Warrant is made to place the holder of the Warrant in the same position as it would have been but for such assignment. Any holder of the Warrant may assign this Agreement (in whole or in part) or any rights or obligations hereunder without the consent of the Company in connection with any sale or transfer of all or any portion of the Warrant held by such holder. The assignment by a party to this Agreement of any rights hereunder shall not affect the obligations of such party under this Agreement, except that a sale or transfer of all or any portion of the Warrant by any holder thereof shall release such holder of all of such holder’s obligations hereunder with respect thereto.

Section 18. Waivers. No waiver by either party of any default with respect to any provision, condition of requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any other provision, condition or requirement hereof nor shall any delay or omission of either party to exercise any right hereunder in any manner impair the exercise of any such right accruing to it thereafter.

Section 19. Governing Law. This Agreement and the Warrant Certificate issued hereunder shall be deemed to be a contract made under the laws of the State of Delaware and for all purposes shall be governed by and construed and enforced in accordance with the internal laws of such state without regard to such state’s principles of conflict of laws.

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Section 20. Amendment. This Agreement may be amended only by a written instrument, signed by the Warrant Holders representing at least a majority of the Warrant Shares and the Company, which specifically states that it is amending this Agreement.

Section 21. Headings. The headings herein are for convenience only, do not constitute a part of this Agreement and shall not be deemed to limit or affect any of the provisions hereof.

Section 22. Severability. If any provision of this Agreement be held to be illegal, invalid or unenforceable under any present or future law, and if the rights or obligations of any party hereto will not be materially and adversely affected thereby, such provision will be fully severable.

Section 23. Entire Agreement. This Agreement, together with the Warrant Certificate and the Investor Rights Agreement, contains the entire understandings of the parties with respect to the matters covered hereby and except as specifically set forth herein or therein, neither of the parties hereto makes any representation, warranty, covenant or undertaking with respect to such matters.

Section 24. Execution. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party, it being understood that both parties need not sign the same counterpart. In the event any signature is delivered by facsimile transmission, the party using such means of delivery shall cause the manually executed signature page(s) to be physically delivered to the other party within five (5) days of the execution hereof.

Section 25. Remedies. In case any one (1) or more of the covenants and agreements contained in this Agreement shall have been breached, the holders hereof (in the case of a breach by the Company), or the Company (in the case of a breach by a holder), may proceed to protect and enforce their or its rights either by suit in equity and/or by action at law, including, but not limited to, an action for damages as a result of any such breach and/or an action for specific performance of any such covenant or agreement contained in this Agreement.

Section 26. No Impairment of Rights. The Company will not, by amendment of its articles of incorporation or through any other means, avoid or seek to avoid the observance or performance of any of the terms of this Agreement, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Agreement against impairment.

Section 27. Allocated Purchase Price. The Company and the Warrant Holder hereby acknowledge that for the purposes of Section 1273(c)(2) of the Internal Revenue Code, the Warrant is issued in connection with the extension of credit by Lender under the Loan Agreement, and that the allocated purchase price of the Warrant for such purposes is $100. The Company and the Warrant Holder agree to use the foregoing allocated purchase price as the purchase price of the Warrant for all income tax purposes.

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COMMON STOCK WARRANT AGREEMENT SIGNATURE PAGE

IN WITNESS WHEREOF, the parties have caused this Common Stock Warrant Agreement to be executed in accordance with the terms set forth herein.

the “Company”
PROFESSOR CONNOR’S, INC. a Delaware corporation
By:	/s/ Richard A Kassan
Name:	Richard A Kassan
Title:	CEO

COMMON STOCK WARRANT AGREEMENT SIGNATURE PAGE

the “Warrant Holder”

CITY NATIONAL BANK

By:

Name:

Title:

EXHIBIT A

FORM OF WARRANT CERTIFICATE

THESE WARRANTS AND THE SHARES PURCHASABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION, AND MUST BE HELD INDEFINITELY UNLESS SUBSEQUENTLY REGISTERED UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS OR DISPOSED OF PURSUANT TO AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS.

PROFESSOR CONNOR’S, INC.

WARRANT

Dated as of October     , 2007

Warrant No.                   Shares of Common Stock

PROFESSOR CONNOR’S, INC., a Delaware corporation (the “Company”), by this certificate (a “Warrant Certificate”) certifies that, for value received, CITY NATIONAL BANK, a national banking association (“Warrant Holder”), or its registered assigns (sometimes hereinafter referred to as the “Warrantholders”) shall have the right to purchase from the Company                                          (            ) fully paid and nonassessable shares (together with shares issued upon exchange, transfer or replacement thereof, the “Shares”) of Common Stock of the Company at any time or from time to time until 5:00 p.m. Los Angeles time on the tenth (10th) anniversary of this Warrant, at an exercise price of $4.6438 per Share, subject to adjustment (as such price may be adjusted, the “Exercise Price”), as provided in that certain Common Stock Warrant Agreement between the Company and Warrant Holder dated as of October 5, 2007 (the “Warrant Agreement”; capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Warrant Agreement), upon surrender of this Warrant Certificate to the Company, delivery of a duly completed and executed Notice of Exercise in the form attached hereto to the Company, and payment of the Exercise Price for each Share for which this Warrant is exercised, but, in each case, only subject to the terms and conditions set forth in the Warrant Agreement.

This Warrant is subject to the terms and conditions of the Warrant Agreement.

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IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be signed by its duly authorized officer as of the date indicated below.

Dated: October 5, 2007	PROFESSOR CONNOR’S, INC.
	a Delaware corporation
	By:
	Name:
	Title:

EXHIBIT B

NOTICE OF EXERCISE

To: PROFESSOR CONNOR’S, INC.

1. The undersigned hereby elects to purchase             shares of Common Stock (or an equivalent thereof) of PROFESSOR CONNOR’S, INC. pursuant to the terms of the attached Warrant and Agreement, and tenders herewith payment of $             , which constitutes the purchase price of such shares in full.

2. Please issue a certificate or certificates representing said shares in the name of the undersigned or in such other name or names as are specified below:

(Name)

(Address)

3. The undersigned represents that the aforesaid shares are being acquired for the account of the undersigned for investment, and not as a nominee for any other party, and not with a view to, or for offer or resale in connection with, the distribution thereof and that the undersigned has no present intention of distributing or reselling such shares. In support thereof, the undersigned has executed an Investment Representation Statement attached hereto as Schedule 1.

(Signature)

        (Date)

Schedule 1

INVESTMENT REPRESENTATION STATEMENT

Purchaser:
Company:	PROFESSOR CONNOR’S, INC.
Security:	Common Stock
Amount:
Date:

In connection with the purchase of the above-listed securities (the “Securities”), the undersigned (the “Purchaser”) represents to the Company as follows:

(a) The Purchaser is purchasing the Securities for its own account for investment purposes only, not as a nominee or agent, and not with a view to, or for the resale in connection with, any “distribution” thereof for purposes of the Securities Act of 1933, as amended (the “Securities Act”).

(b) The Purchaser is aware of the Company’s business affairs and financial condition, and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. The Purchaser represents that it is experienced in evaluating and investing in private placement transactions of securities of companies in a similar stage of development and acknowledges that the Purchaser is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial and business matters that the Purchaser is capable of evaluating the merits and rights of the investment in the Securities. The Purchaser is an “accredited investor”, as such term is defined in Rule 501 of Regulation D as promulgated under the Securities Act.

(c) The Purchaser understands that the Securities have not been registered under the Securities Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Purchaser’s investment intent as expressed herein. In this connection, the Purchaser understands that, in the view of the Securities and Exchange Commission (“SEC”), the statutory basis for such exemption may be unavailable if the Purchaser’s representation was predicated solely upon a present intention to hold these Securities for the minimum capital gains period specified under applicable tax laws, for a deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. The Purchaser has no such intention.

(d) The Purchaser further understands that the Securities must be held indefinitely unless subsequently registered under the Securities Act or unless an exemption from registration is otherwise available. In addition, the Purchaser understands that the certificate evidencing the Securities will be imprinted with the legend referred to in the Warrant under which the Securities are being purchased.

(e) The Purchaser is aware of the provisions of Rule 144 and 144A, promulgated under the Securities Act, which, in substance, permit limited public resale of “restricted securities” acquired, directly or indirectly, from the issuer thereof (or from an affiliate of such issuer), in a non-public offering subject to the satisfaction of certain conditions, if applicable, including, among other things: The availability of certain public information about the Company, the resale occurring not less than one (1) year after the party has purchased and paid for the securities to be sold; the sale being made through a broker in an unsolicited “broker’s transaction” or in transactions directly with a market maker (as said term is defined under the Securities Exchange Act of 1934, as amended) and the amount of securities being sold during any three-month period not exceeding the specified limitations stated therein. The Warrant Holder is aware that the public information about the Company required by Rule 144 is not currently available and the Company has no present plans to make such information available.

(f) The Purchaser further understands that there is no, and at the time it wishes to sell the Securities there may be no, public market upon which to make a sale of the Securities, and that, even if such a public market then exists, the Company may not be satisfying the current public information requirements of Rule 144 and 144A, and that, in such event, the Purchaser may be precluded from selling the Securities under Rule 144 and 144A even if the one-year minimum holding period had been satisfied.

(g) The Purchaser further understands that in the event all of the requirements of Rule 144 and 144A are not satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rule 144 is not exclusive, the Staff of the SEC has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rule 144 will have a substantial burden or proof in establishing that an exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk.

Purchaser:

Date:

EXHIBIT C

JOINDER AGREEMENT TO STOCKHOLDERS AGREEMENT

OF PROFESSOR CONNOR’S, INC.

This Joinder Agreement (this “Joinder Agreement”) is made as of the date written below by City National Bank, a national banking association, for the purpose of each of the undersigned becoming a party to the Stockholders Agreement (the “Stockholders Agreement”) dated as of October 25, 2006, among Professor Connor’s, Inc., a Delaware corporation (the “Company”) and its shareholders (the “Stockholders”).

Accordingly, the undersigned hereby acknowledges, agrees and confirms that, by its execution of this Joinder Agreement, each of the undersigned shall be deemed to be a party to the Stockholders Agreement as of the date hereof and shall have all of the rights and obligations of a “Stockholder” thereunder as if it had executed the Stockholders Agreement. Each of the undersigned hereby ratifies, as of the date hereof, and agrees to be bound by, all of the terms, provisions and conditions contained in the Stockholders Agreement.

[Signature Page to Follow]

IN WITNESS WHEREOF, the undersigned has executed this Joinder Agreement as of the date written below.

PROFESSOR CONNOR’S, INC.,

a Delaware corporation

By:

Name:

Title:

CITY NATIONAL BANK,

a national banking association

By:

Name:

Title:

EX-10.1

Exhibit 10.1

AMENDED AND RESTATED CREDIT AGREEMENT

THIS AMENDED AND RESTATED CREDIT AGREEMENT (this “Agreement”), dated as of April 12, 2013, among (1) PROFESSOR CONNOR’S, INC., a Delaware corporation (the “Borrower”), (2) the several banks and other lenders from time to time parties to this Agreement (the “Lenders”) and (3) ONEWEST BANK, FSB (“OneWest Bank”), as administrative agent for the Lenders (in such capacity, the “Agent”).

RECITALS

A. The Borrower, the Lenders and the Agent are party to that certain Credit Agreement dated as of June 8, 2012 (the “Existing Credit Agreement”) pursuant to which the Lenders made available to the Borrower a revolving credit facility in the maximum principal amount of $40,000,000.

B. The Borrower has requested that the Lenders (i) increase the revolving loan facility as set forth herein and (ii) make other changes to the Credit Agreement as set forth herein, and the Agent and the Lenders have agreed to such increase and changes, in each case on the terms and conditions set forth in this Agreement.

Accordingly, the parties hereto agree that the Existing Credit Agreement is hereby amended and restated as set forth in this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto hereby agree as follows:

SECTION 1. DEFINITIONS

1.1 Defined Terms. As used in this Agreement, the following terms shall have the following meanings:

“Accountants”: a firm of independent certified public accountants as shall be selected by the Borrower and reasonably satisfactory to the Agent.

“Account”: an account (as that term is defined in the UCC).

“Account Debtor”: any Person who is obligated on an Account, chattel paper, or a General Intangible.

“Acquisition”: any transaction, or any series of related transactions, consummated after the Closing Date, by which the Borrower and/or any of its Subsidiaries directly or indirectly (a) acquires any ongoing business or all or substantially all of the assets of any firm, partnership, joint venture, limited liability company, corporation or division thereof, whether through purchase of assets, merger or otherwise, (b) acquires in one transaction or as the most recent transaction in a series of transactions control of securities of a Person engaged in an ongoing business representing more than 50% of the ordinary voting power for the election of directors or

other governing position if the business affairs of such Person are managed by a board of directors or other governing body or (c) acquires control of more than 50% of the ownership interest in any partnership, joint venture, limited liability company, business trust or other Person that is not managed by a board of directors or other governing body.

“Additional Documents”: has the meaning assigned to such term in Section 9.4(c).

“Affiliate”: as to any Person, (a) any other Person which, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person or (b) any Person who is a director, officer, shareholder, member or partner (i) of such Person, (ii) of any Subsidiary of such Person or (iii) of any Person described in the preceding clause (a). For purposes of this definition, “control” of a Person means the power, directly or indirectly, either to (i) vote securities having 10% or more of the ordinary voting power for the election of directors or managers of such Person or (ii) direct or cause the direction of the management and policies of such Person whether by contract or otherwise.

“Agreement”: the Existing Credit Agreement, as amended and restated by this Amended and Restated Credit Agreement, and as this Amended and Restated Credit Agreement may be further amended, restated, supplemented or otherwise modified from time to time.

“Agent”: as defined in the preamble hereto.

“Anti-Terrorism Laws”: any Requirements of Law relating to terrorism or money laundering, including Executive Order No. 13224, the PATRIOT Act, the Bank Secrecy Act, the Money Laundering Control Act of 1986 (i.e., 18 U.S.C. §§ 1956 and 1957), the Requirements of Law administered by OFAC, and all Requirements of Law comprising or implementing these laws.

“Asset Disposition”: the sale, sale and leaseback, transfer, conveyance, exchange, long-term lease accorded sales treatment under GAAP or similar disposition (including by means of a merger, consolidation, amalgamation, joint venture or other substantive combination) of any of the properties, business or assets (other than cash and Cash Equivalents, but including the assignment of any lease, license or permit relating to any property) of the Borrower or any of its Subsidiaries to any Person or Persons; provided that Asset Dispositions shall not include any of the following:

(a) the sale of inventory in the ordinary course of business;

(b) dispositions of assets or property between or among the Loan Parties;

(c) dispositions in the ordinary course of business constituting the sale or discount of Accounts reasonably deemed by the Borrower to be uncollectible;

(d) the sale of obsolete or worn-out assets or assets no longer used or useful in the business of the Loan Parties;

(e) the licensing, on a non-exclusive basis, of patents, trademarks, copyrights, and other intellectual property rights in the ordinary course of business; and

(f) any disposition or issuance by the Borrower of its own equity interests to the extent that any such issuance does not result in a Change of Control.

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“Assignment and Acceptance”: an Assignment and Acceptance in the form of Exhibit F to this Agreement.

“Available Revolving Loan Commitment”: with respect to each Lender on the date of determination thereof, the amount by which (a) the Revolving Loan Commitment of such Lender on such date exceeds (b) the principal sum of such Lender’s Revolving Loans outstanding.

“Base Rate”: for any day, a rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) equal to the greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%. “Prime Rate” shall mean the rate of interest per annum as published in The Wall Street Journal on the date of measurement or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board as determined by the Agent as the “bank prime loan” rate. “Federal Funds Effective Rate” shall mean, for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for the day of such transactions received by the Agent from three federal funds brokers of national recognized standing selected by it. If, for any reason, the Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate for any reason, including the inability or failure of the Agent to obtain sufficient quotations in accordance with the terms hereof, the Base Rate shall be determined without regard to clause (b) of the first sentence of this definition until the circumstances giving rise to such inability no longer exist. Any change in the Base Rate due to a change in the Reference Rate or the Federal Funds Effective Rate shall be effective on the effective date of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.

“Base Rate Loans”: Revolving Loans the rate of interest applicable to which is based upon the Base Rate.

“Benefit Plan”: a “defined benefit plan” (as defined in Section 3(35) of ERISA) for which Borrower or any Subsidiary or ERISA Affiliate of Borrower has been an “employer” (as defined in Section 3(5) of ERISA) within the past six years.

“Blocked Person”: a Person (i) listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224, (ii) owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, Executive Order No. 13224, (iii) with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law, (iv) that commits, threatens or conspires to commit or supports “terrorism” as defined in Executive Order No. 13224 or (v) that is named a “specially designated national” or “blocked person” on the most current list published by OFAC or other similar list.

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“Books”: all of Borrower’s and its Subsidiaries’ now owned or hereafter acquired books and records (including all of their Records indicating, summarizing, or evidencing their assets (including the Collateral) or liabilities, all of Borrower’s and its Subsidiaries’ Records relating to their business operations or financial condition, and all of their goods or General Intangibles related to such information).

“Borrower”: as defined in the preamble hereto.

“Borrower Collateral”: all of Borrower’s now owned or hereafter acquired right, title, and interest in and to each of the following:

(a) all of its Accounts,

(b) all of its Books,

(c) all of its commercial tort claims described on Schedule 1.1(c),

(d) all of its Deposit Accounts,

(e) all of its Equipment,

(f) all of its General Intangibles,

(g) all of its Inventory,

(h) all of its Investment Property (including all of its securities and Securities Accounts),

(i) all of its Negotiable Collateral,

(j) all of its Supporting Obligations,

(k) money or other assets of Borrower that now or hereafter come into the possession, custody, or control of the Agent, and

(l) the proceeds and products, whether tangible or intangible, of any of the foregoing, including proceeds of insurance covering any or all of the foregoing, and any and all Accounts, Books, Deposit Accounts, Equipment, General Intangibles, Inventory, Investment Property, Negotiable Collateral, Real Property, Supporting Obligations, money, or other tangible or intangible property resulting from the sale, exchange, collection, or other disposition of any of the foregoing, or any portion thereof or interest therein, and the proceeds thereof.

“Borrowing Notice”: a notice from the Borrower to the Agent requesting a borrowing of Revolving Loans, substantially in the form of Exhibit D hereto.

“Business Day”: a day other than a Saturday, Sunday or other day on which commercial banks in the State of California are authorized or required by law to close and which, in the case of a LIBOR Loan, is a Eurodollar Business Day.

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“Canadian Subsidiary”: means Professor Connors Canada, Inc., a company organized under the laws of the province of Ontario.

“Capital Lease”: a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP. Notwithstanding anything else set forth herein, any lease that was or would have been treated as an operating lease under GAAP as in effect on the Closing Date that would be treated as a capital lease solely as a result of a change in GAAP after the Closing Date shall always be treated as an operating lease for all purposes and at all times under this Agreement.

“Capitalized Lease Obligation”: that portion of the obligations under a Capital Lease that is required to be capitalized in accordance with GAAP.

“Capital Stock”: any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), any and all warrants, options or rights to purchase or any other securities convertible into any of the foregoing.

“Cash Equivalents”: (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within 1 year from the date of acquisition thereof, (b) marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within 1 year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either Standard & Poor’s Rating Group (“S&P”) or Moody’s Investor Service, Inc. (“Moody’s”), (c) commercial paper maturing no more than two-hundred-seventy (270) days from the date of creation thereof and, at the time of acquisition, having a rating of at least A-1 from S&P or at least P-1 from Moody’s, (d) certificates of deposit or bankers’ acceptances maturing within 1 year from the date of acquisition thereof issued by any bank organized under the laws of the United States or any state thereof having at the date of acquisition thereof combined capital and surplus of not less than $250,000,000, (e) Deposit Accounts maintained with (i) any bank that satisfies the criteria described in clause (d) above, or (ii) any other bank organized under the laws of the United States or any state thereof so long as the amount maintained with any such other bank is less than or equal to $100,000 and is insured by the Federal Deposit Insurance Corporation, and (f) investments in money market funds substantially all of whose assets are invested in the types of assets described in clauses (a) through (e) above.

“Change in Law”: means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking

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Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“Change of Control”: (a) Permitted Holders fail to own and control, directly or indirectly, 50.1% or more, of the Capital Stock of Borrower having the right to vote for the election of members of the Board of Directors, (b) Freshpet Investors, LLC fails to own and control, directly or indirectly, 15% or more, of the Stock of Borrower having the right to vote for the election of members of the Board of Directors, or (c) a majority of the members of the Board of Directors do not constitute Continuing Directors.

“Chillers”: refrigerated unit out of which the Loan Parties’ products are sold.

“Closing Date”: June 8, 2012.

“Code”: the Internal Revenue Code of 1986, as amended from time to time.

“Collateral”: all of the property (tangible or intangible) purported to be subject to the lien or security interest purported to be created by any Collateral Document executed by any Loan Party as security for all or part of the Obligations.

“Collateral Documents”: this Agreement, the Control Agreements and all other instruments, documents and agreements encumbering the Collateral or evidencing or perfecting a security interest therein for the benefit of the Agent or any Lender executed by the Borrower, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with the terms hereof and thereof.

“Collections”: all cash, checks, notes, instruments, and other items of payment (including insurance proceeds, proceeds of cash sales, rental proceeds, and tax refunds).

“Commercial Tort Claim Assignment”: has the meaning assigned to such term in Section 9.4(b).

“Compliant Guarantor”: subject to Section 7.2, a Guarantor that is in compliance with its respective Guarantee with no Guarantor Default in existence.

“Continuation Notice”: a request for continuation or conversion of a Revolving Loan as set forth in Section 2.4, substantially in the form of Exhibit C.

“Continuing Director”: (a) any member of the Board of Directors who was a director (or comparable manager) of Borrower on the Closing Date, and (b) any individual who becomes a member of the Board of Directors after the Closing Date if such individual was appointed or nominated for election to the Board of Directors by a majority of the Continuing Directors, but excluding any such individual originally proposed for election in opposition to the Board of Directors in office at the Closing Date in an actual or threatened election contest relating to the election of the directors (or comparable managers) of the Borrower and whose initial assumption of office resulted from such contest or the settlement thereof.

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“Contractual Obligation”: as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“Control Agreement”: a control agreement, restricted account agreement or similar agreement or document, in each case in form and substance reasonably satisfactory to the Agent and entered into for the purpose of perfecting a security interest in one or more deposit accounts or securities accounts of the Loan Parties.

“Copyright Security Agreement”: a copyright security agreement executed and delivered by Borrower and the Agent, the form and substance of which is reasonably satisfactory to the Agent.

“Covenant Compliance Certificate”: a certificate of a Responsible Officer or other senior officer of the Borrower substantially in the form of Exhibit E hereto.

“Covered Amount”: as defined in the definition of “Maximum Revolving Amount” herein.

“Default”: an event, condition, or default that, with the giving of notice, the passage of time, or both, would be an Event of Default.

“Defaulting Lender”: has the meaning assigned to such term in Section 2.1(e).

“Deposit Account”: any deposit account (as that term is defined in the UCC).

“Dollars” and “$”: dollars in lawful currency of the United States.

“Environmental Laws”: any applicable federal, state, provincial, foreign or local statute, law, rule, regulation, ordinance, code, binding and enforceable guideline, binding and enforceable written policy, or rule of common law now or hereafter in effect and in each case as amended, or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, in each case, to the extent binding on Borrower or its Subsidiaries, relating to the environment, the effect of the environment on employee health, or Hazardous Materials, including the Comprehensive Environmental Response Compensation and Liability Act, 42 USC § 9601 et seq.; the Resource Conservation and Recovery Act, 42 USC § 6901 et seq.; the Federal Water Pollution Control Act, 33 USC § 1251 et seq.; the Toxic Substances Control Act, 15 USC § 2601 et seq.; the Clean Air Act, 42 USC § 7401 et seq.; the Safe Drinking Water Act, 42 USC § 3803 et seq.; the Oil Pollution Act of 1990, 33 USC § 2701 et seq.; the Emergency Planning and the Community Right-to-Know Act of 1986, 42 USC § 11001 et seq.; the Hazardous Material Transportation Act, 49 USC § 1801 et seq.; and the Occupational Safety and Health Act, 29 USC §651 et seq. (to the extent it regulates occupational exposure to Hazardous Materials); any state and local or foreign counterparts or equivalents, in each case as amended from time to time.

“Equipment”: equipment (as that term is defined in the UCC) and includes machinery, machine tools, motors, furniture, furnishings, fixtures, vehicles (including motor vehicles), computer hardware, tools, parts, and goods (other than consumer goods, farm products, or Inventory), wherever located, including all attachments, accessories, accessions, replacements, substitutions, additions, and improvements to any of the foregoing.

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“Equityholder Agreements”: each shareholder agreement, member agreement, partner agreement, voting agreement, buy-sell agreement, option, warrant, put, call, right of first refusal, and other agreement or instrument governing the equity of any Loan Party or any other security with conversion rights into equity of any Loan Party.

“Equity Contribution Agreement”: the Equity Contribution Agreement dated as of the Closing Date and executed by the Borrower and the MidOcean Entities, in favor of the Agent, for the benefit of the Agent and the Lenders, as amended by the First Amendment to Equity Contribution Agreement delivered pursuant to Section 4.1 of this Agreement, and as it may be further amended, restated, supplemented or otherwise modified from time to time.

“ERISA”: the Employee Retirement Income Security Act of 1974, as amended from time to time.

“ERISA Affiliate”: as to any Person, each trade or business including such Person, whether or not incorporated, which together with such Person would be treated as a single employer under Section 4001(a)(14) of ERISA.

“Eurodollar Business Day”: any day on which banks are open for dealings in Dollar deposits in the London interbank market.

“Event of Default”: any of the events specified in Section 7.1, provided that any requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied.

“Excluded Taxes”: all (A)(i) taxes imposed on, by reference to or measured in whole or in part by the revenue, net income, capital or net worth of the Agent or any Lender, (ii) franchise or other taxes imposed in lieu thereof and (iii) taxes on doing business or taxes measured by capital or net worth imposed on the Agent or any Lender by any Governmental Authority in a jurisdiction in which the Agent or any Lender (a) is organized, (b) maintains its principal office, (c) is doing business or (d) has a lending office and (B) any withholding taxes imposed by the United States for any period with respect to which any Lender has failed to provide the Borrower with the appropriate form or forms as required by Section 10.6(i).

“Existing Credit Agreement”: as defined in the recitals hereto.

“Financial Statements”: (a) the audited balance sheets of the Borrower for the fiscal year ended December 31, 2011, and the related statements of income, changes in shareholders’ equity, and cash flows as of and for the fiscal years then ended, and (b) the unaudited balance sheet of the Borrower, as of December 31, 2012, and the related statements of income, changes in owners’ equity and cash flows as of and for the fiscal quarter then ended.

“Fresh Pet Guarantee”: that certain Shareholder Guarantee executed by the Kayne Investors in favor of the Agent.

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“GAAP”: generally accepted accounting principles in the United States in effect from time to time.

“General Intangibles”: general intangibles (as that term is defined in the UCC), including payment intangibles, contract rights, rights to payment, rights arising under common law, statutes, or regulations, choses or things in action, goodwill, patents, trade names, trade secrets, trademarks, servicemarks, copyrights, blueprints, drawings, purchase orders, customer lists, monies due or recoverable from pension funds, route lists, rights to payment and other rights under any royalty or licensing agreements, infringement claims, computer programs, information contained on computer disks or tapes, software, literature, reports, catalogs, insurance premium rebates, tax refunds, and tax refund claims, and any other personal property other than Accounts, Deposit Accounts, goods, Investment Property, and Negotiable Collateral.

“Governmental Authority”: any nation or government, any federal, state or other political subdivision thereof and any federal, state or local entity exercising executive, legislative, judicial, regulatory or administrative functions of government.

“Governmental Authorization”: any permit, license, authorization, plan, directive, consent order or consent decree of or from any Governmental Authority.

“Guarantee Obligation”: as to any Person (the “guaranteeing person”), any obligation of (a) the guaranteeing person or (b) another Person (including any bank under any letter of credit) which Person the guaranteeing person has agreed to reimburse or indemnify for undertaking such obligation in either case guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations (the “primary obligations”) of any other third Person (the “primary obligor”) in any manner, whether directly or indirectly, including any obligation of the guaranteeing person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds for the purchase or payment of any such primary obligation or to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in respect thereof; provided, however, that the term Guarantee Obligation shall not include endorsements of instruments for deposit or collection or customary indemnifications under agreements, in each case given or entered into in the ordinary course of business. The amount of any Guarantee Obligation of any guaranteeing person shall be deemed to be the lesser of (a) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee Obligation is made and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of the instrument embodying such Guarantee Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be such guaranteeing person’s maximum reasonably anticipated liability in respect thereof as determined by the Borrower in good faith.

“Guarantees”: each Subsidiary Guarantee, the Shareholder Guarantees and the Equity Contribution Agreement.

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“Guarantor Collateral”: all of the property (tangible or intangible) purported to be subject to the lien or security interest purported to be created by any Guarantor Collateral Document executed by any Guarantor as security for all or part of any Guarantee.

“Guarantor Collateral Documents”: the Guarantor Security Agreement, each Control Agreement requested by the Agent pursuant to the Guarantor Security Agreement, each UCC-1 Financing Statement filed pursuant to any of the foregoing and any other document or agreement encumbering the Guarantor Collateral or evidencing or perfecting a security interest therein for the benefit of the Agent executed by a Guarantor, as the same may be amended, modified or supplemented from time to time in accordance with the terms hereof.

“Guarantor Cure Period”: as defined in Section 7.2 hereof.

“Guarantor Default”: an “Event of Default” as defined in any Shareholder Guarantee or the Equity Contribution Agreement, as applicable, including the failure to maintain and or report “Liquidity” or “Uncalled Capital Commitments”, as applicable, as such terms are defined in and as required under the applicable Guarantee.

“Guarantor Security Agreement”: the Guarantor Security Agreement made by each Subsidiary in favor of the Agent, for the benefit of the Lenders, in form and substance reasonably satisfactory to the Agent, as the same may be amended, modified or supplemented in accordance with the terms thereof.

“Guarantors”: each Subsidiary, the MidOcean Entities and the Shareholder Guarantors, which Shareholder Guarantors guarantee the percentage of the aggregate Revolving Loan Commitments as set forth Schedule 1.1(a).

“Hazardous Materials”: (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable laws or regulations as “hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic substances,” or any other formulation intended to define, list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP toxicity”, (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, and (d) asbestos in any form or electrical equipment that contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of 50 parts per million.

“Hedging Agreements”: as defined in the definition of “Hedging Obligations” in this Section 1.1.

“Hedging Obligations”: of any Person, any and all obligations of such Person, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (i) any and all agreements, devices or arrangements designed to protect at least one of the parties thereto from the fluctuations of interest rates, commodity prices, exchange rates or forward rates applicable to such party’s assets, liabilities or exchange transactions, including dollar-denominated

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or cross-currency interest rate exchange agreements, forward currency exchange agreements, interest rate cap or collar protection agreements, forward rate currency or interest rate options, puts and warrants or any similar derivative transactions (“Hedging Agreements”), and (ii) any and all cancellations, buy-backs, reversals, terminations or assignments of any of the foregoing.

“Indebtedness”: (a) all obligations for borrowed money and Prohibited Preferred Stock, (b) all obligations evidenced by bonds, debentures, notes, or other similar instruments and all reimbursement or other obligations in respect of letters of credit, bankers acceptances, interest rate swaps, or other similar financial products (except to the extent cash collateralized), (c) all obligations as a lessee under Capital Leases, (d) all obligations or liabilities of others secured by a Lien on any asset of a Person or its Subsidiaries, irrespective of whether such obligation or liability is assumed, (e) all obligations to pay the deferred purchase price of assets (other than trade payables, deferred rent, taxes or compensation incurred in the ordinary course of business and repayable in accordance with customary trade practices), (f) all Hedging Obligations, and (g) any obligation guaranteeing or intended to guarantee (whether directly or indirectly guaranteed, endorsed, co-made, discounted, or sold with recourse) any obligation of any other Person that constitutes Indebtedness under any of clauses (a) through (f) above.

“Insolvency”: with respect to any Multiemployer Plan, the condition that such Plan is insolvent within the meaning of Section 4245 of ERISA.

“Interest Payment Date”: (a) as to any Base Rate Loan, the last Business Day of each calendar month to occur while any such Revolving Loan is outstanding, (b) as to any LIBOR Loan having an Interest Period of three months or less, the last day of such Interest Period, (c) as to any LIBOR Loan having an Interest Period longer than three months, each day which is at the end of each three month-period within such Interest Period after the first day of such Interest Period and the last day of such Interest Period and (d) for each of (a), (b) and (c) above, the day on which any such Revolving Loan becomes due and payable in full or is paid or prepaid in full.

“Interest Period”: with respect to any LIBOR Loan:

(a) initially, the period commencing on the borrowing or conversion date, as the case may be, with respect to such LIBOR Loan and ending one, two, three, six, nine or twelve months thereafter as available, as selected by the Borrower in its notice of borrowing or its Continuation Notice, as the case may be, given with respect thereto; and

(b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such LIBOR Loan and ending one, two, three, six, nine or twelve months thereafter as available, as selected by the Borrower by irrevocable notice to the Agent not less than three (3) Eurodollar Business Days prior to the last day of the then current Interest Period with respect thereto;

provided that, all of the foregoing provisions relating to Interest Periods are subject to the following:

(i) if any Interest Period pertaining to a LIBOR Loan would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next

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succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month in which event such Interest Period shall end on the immediately preceding Business Day;

(ii) any Interest Period for any Revolving Loan that would otherwise extend beyond the date final payment is due on such Revolving Loan shall end on the date of such final payment; and

(iii) any Interest Period pertaining to a LIBOR Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month.

“Inventory”: inventory (as that term is defined in the UCC).

“Investment Company Act”: as defined in Section 3.12 hereof.

“Investment Property”: investment property (as that term is defined in the UCC).

“Kayne Investors”: Richard Kayne and The Richard and Suzanne Kayne Living Trust under the Agreement dated January 14, 1999.

“Lenders”: as defined in the preamble hereto and Section 8.8 hereof.

“Lender Hedging Agreement”: any Hedging Agreement entered into between the Borrower or any Subsidiary and a Lender, or a Person who was a Lender at the time such Hedging Agreement was entered into, the Agent, or an Affiliate thereof.

“LIBOR”: with respect to any LIBOR Loan for any Interest Period, the rate per annum determined by the Agent and equal to the rate (rounded upwards, if necessary, to the nearest 1/16 of 1%) quoted as (i) the rate at which dollar deposits in immediately available funds are offered two (2) Eurodollar Business Days prior to the first day of such Interest Period for delivery on the first day of such Interest Period in the interbank Eurodollar market on or about 9:00 a.m. (Los Angeles time) or (ii) the “LIBOR Rate” set forth in the money rates section of the Wall Street Journal two (2) Business Days prior to the first day of such Interest Period, in each case for a period equal to such Interest Period and in an amount comparable to the amount of such LIBOR Loan. The Agent currently uses Bloomberg to provide information with respect to the interbank Eurodollar market, but the Agent, in its sole discretion, may change the service providing such information at any time and/or may rely upon the rate quoted in the Wall Street Journal as indicated above. Each determination of the LIBOR Rate by the Agent shall be conclusive and binding upon the parties hereto, absent manifest error.

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“LIBOR Adjusted Rate”: with respect to each day during each Interest Period pertaining to a LIBOR Loan, a rate per annum determined for such day in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):

LIBOR

1.00 - LIBOR Reserve Requirements

“LIBOR Loans”: Revolving Loans the rate of interest applicable to which is based upon LIBOR Adjusted Rate.

“LIBOR Reserve Requirements”: for any day as applied to a LIBOR Loan, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including basic, supplemental, marginal and emergency reserves under any regulations of the Board of Governors of the Federal Reserve System or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of such Board) maintained by a member bank of such Federal Reserve System.

“Lien”: any mortgage, pledge, charge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), security agreement or other security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement or any Capitalized Lease Obligation having substantially the same economic effect as any of the foregoing).

“Liquidity”: means as of the date of determination the sum of (a) unencumbered cash (other than Liens permitted by Sections 6.3(a) and (j)), and Cash Equivalents owned by the Loan Parties, (b) the aggregate available Revolving Loan Commitments hereunder, and (c) the aggregate principal amount

-available to be borrowed under the terms of the Senior Credit Agreement.

“Loan Documents”: this Agreement, any Revolving Notes, the Collateral Documents, the Guarantor Collateral Documents, the Guarantees, any Lender Hedging Agreements, the Subordination Agreement, the agency letter between the Borrower and the Agent, and any other agreement executed by a Loan Party in connection therewith and herewith, as such agreements and documents may be amended, restated, supplemented and otherwise modified from time to time in accordance with the terms hereof.

“Loan Parties”: the Borrower and the Subsidiaries.

“Majority Lenders”: Lenders having Revolving Loan Commitments equal to or more than 50.1% of the aggregate Revolving Loan Commitment, or, if any Revolving Loan Commitment has terminated, with respect to such Revolving Loan Commitment, Lenders with outstanding Loans under such Commitment having an unpaid principal balance equal to or more

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than 50.1% of the sum of the unpaid principal balance of all Revolving Loans outstanding, excluding from such calculation Lenders which have failed or refused to fund a Revolving Loan when required to do so; provided that at all times that there are only two Lenders, the Majority Lenders shall mean both such Lenders; provided further that at all times that there are only three Lenders and one of those Lenders is also the Agent who holds more than 50.1% of the sum of the unpaid principal balance of all Revolving Loans outstanding, the Majority Lenders shall mean two of the three Lenders.

“Margin Stock”: as defined in Regulation U.

“Material Adverse Effect”: a material adverse effect on (a) the business, operations, property or condition (financial or otherwise) of the Loan Parties, taken as a whole, (b) the ability of the Loan Parties to perform their obligations under the Loan Documents or (c) the validity or enforceability of the Loan Documents or the rights or remedies of the Agent or the Lenders hereunder or thereunder.

“Maximum Debt Covenant”: as defined in Section 6.2.

“Maximum Revolving Amount”: as of any date of determination, the lesser of (i) the aggregate Revolving Loan Commitments and (ii) the sum of the principal amounts set forth in the “Amount” column of Schedule 1.1(a) attached hereto, as it may be adjusted from time to time as contemplated by the last sentence of Section 2.2 (such amount, the “Covered Amount”), of each Compliant Guarantor.

“MidOcean Entities”: collectively, MidOcean Partners III, L.P., an exempted limited partnership formed under the laws of the Cayman Islands (“MidOcean III”), MidOcean Partners III-A, L.P., an exempted limited partnership formed under the laws of the Cayman Islands (“MidOcean III-A”) and MidOcean Partners III-D, L.P., a limited partnership formed under the laws of the State of Delaware (“MidOcean III-D”).

“MidOcean III Partnership Agreement”: that certain Amended and Restated Agreement of Exempted Limited Partnership dated as of July 31, 2006, as amended by the First Amendment dated as of March 30, 2007, the Second Amendment dated as of May 31, 2007, the Third Amendment dated as of June 23, 2008, the Fourth Amendment dated as of February 3, 2009 and the Fifth Amendment dated as of March 20, 2012, and as it may be further amended, modified or restated from time to time.

“MidOcean III-A Partnership Agreement”: that certain Amended and Restated Agreement of Exempted Limited Partnership dated as of July 31, 2006, as amended by the First Amendment dated as of March 30, 2007, the Second Amendment dated as of May 31, 2007, the Third Amendment dated as of June 23, 2008, the Fourth Amendment dated as of February 3, 2009 and the Fifth Amendment dated as of March 20, 2012, and as it may be further amended, modified or restated from time to time.

“MidOcean III-D Partnership Agreement”: that certain Amended and Restated Agreement of Limited Partnership dated as of July 31, 2006, as amended by the First Amendment dated as of March 30, 2007, the Second Amendment dated as of May 31, 2007, the Third Amendment dated as of June 23, 2008, the Fourth Amendment dated as of February 3, 2009 and the Fifth Amendment dated as of March 20, 2012, and as it may be further amended, modified or restated from time to time.

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“Multiemployer Plan”: a plan which is a multiemployer plan as defined in Section 4001(a)(3) of ERISA and which is subject to Title IV of ERISA.

“Negotiable Collateral”: letters of credit, letter of credit rights, instruments, promissory notes, drafts, documents, and chattel paper (including electronic chattel paper and tangible chattel paper).

“New Lender”: as defined in Section 2.16(c).

“New Lender Joinder”: as defined in Section 2.16(c).

“Non-Compliant Guarantor”: a Guarantor that is not a Compliant Guarantor.

“Norris Investors”: Charles A. Norris and The Norris Trust, dated June 18, 2002.

“Obligations”: the unpaid principal of and interest on (including interest accruing after the maturity of the Revolving Loans and interest accruing on or after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding and whether or not at a default rate) the Revolving Loans, and all other obligations and liabilities of the Borrower and its Subsidiaries to the Agent and the Lenders, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which may arise under, out of, or in connection with, this Agreement, any other Loan Document and any other document made, delivered or given in connection herewith or therewith, including any and all Lender Hedging Agreements, whether on account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses (including all reasonable fees and disbursements of counsel, and the allocated reasonable cost of internal counsel, to the Agent and the Lenders that are required to be paid by the Borrower and its Subsidiaries pursuant to the terms of this Agreement) or otherwise.

“OFAC”: the U.S. Department of Treasury Office of Foreign Assets Control, or any successor thereto.

“OFAC Lists”: collectively, the Specially Designated Nationals and Blocked Persons List maintained by OFAC pursuant to any of the rules and regulations of OFAC or pursuant to any applicable executive orders, including Executive Order No. 13224, as that list may be amended from time to time.

“OneWest Bank”: as defined in the preamble hereto.

“Organic Documents”: with respect to any entity, in each case to the extent applicable thereto, its certificate or articles of incorporation or organization, its by-laws or operating agreement, its partnership agreement, all other formation and/or governing documents, and all Equityholder Agreements, voting agreements and similar arrangements applicable to any of its authorized shares of capital stock, its partnership interests or its membership interests, and any other arrangements relating to the control or management of any such entity (whether existing as corporation, a partnership, a limited liability company or otherwise).

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“Participant”: as defined in Section 10.6(b) hereof.

“Partnership Agreements”: collectively, the MidOcean III Partnership Agreement, the MidOcean III-A Partnership Agreement and the MidOcean III-D Partnership Agreement.

“PBGC”: the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA or any successor thereto.

“Permitted Holders”: means the Persons identified on Schedule 1.1(b) hereto.

“Permitted Protest”: the right of Borrower or any of its Subsidiaries to protest any Lien (other than any Lien that secures the Obligations), taxes (other than payroll taxes or taxes that are the subject of a United States federal tax lien), or rental payment, provided that (a) a reserve with respect to such obligation is established on the Books in such amount as is required under GAAP, (b) any such protest is instituted promptly and prosecuted diligently by Borrower or any of its Subsidiaries, as applicable, in good faith, and (c) the Agent is satisfied that, while any such protest is pending, there will be no impairment of the enforceability, validity, or priority of any of the Agent’s Liens.

“Permitted Purchase Money Indebtedness”: means, as of any date of determination, Purchase Money Indebtedness that does not constitute Subordinated Debt and that is incurred after the Restatement Closing Date in an aggregate amount outstanding at any one time not in excess of $500,000 plus any Purchase Money Indebtedness used to finance the purchase of Chillers.

“Person”: any individual, firm, partnership, joint venture, corporation, limited liability company, association, business enterprise trust, unincorporated organization, government or department or agency thereof or other entity, whether acting in an individual, fiduciary or other capacity.

“Plan”: any plan (other than a Multiemployer Plan) subject to Title IV of ERISA maintained for employees of the Borrower or any ERISA Affiliate of the Borrower (and any such plan no longer maintained by the Borrower or any of the Borrower’s ERISA Affiliates to which the Borrower or any of the Borrower’s ERISA Affiliates has made or was required to make any contributions within any of the five preceding years).

“Plant”: the Borrower’s manufacturing facility located at 176 North Commerce Way, Bethlehem, Pennsylvania.

“Plant Mortgage”: that certain Open-End Mortgage, Security Agreement and Fixture Filing dated as of October 2, 2012, made by the Borrower for the benefit of the Agent, as recorded in the real property records of the County of Northhampton, Pennsylvania, on October 5, 2012, as Instrument No. 2012032095, as amended by that certain First Mortgage Modification Agreement dated as of the Restatement Closing Date.

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“Preferred Stock”: as applied to the Capital Stock of any Person, the Capital Stock of any class or classes (however designated) that is preferred with respect to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of Capital Stock of any other class of such Person.

“Prohibited Preferred Stock”: any Preferred Stock that by its terms is mandatorily redeemable or subject to any other payment obligation (including any obligation to pay dividends, other than dividends of shares of Preferred Stock of the same class and series payable in kind or dividends of shares of common stock) on or before a date that is less than 6 months after the Revolving Loan Commitment Expiration Date, or, on or before the date that is less than 6 months after the Revolving Loan Commitment Expiration Date, is redeemable at the option of the holder thereof for cash or assets or securities (other than distributions in kind of shares of Preferred Stock of the same class and series or of shares of common stock). The Class B Preferred Stock and Class C Preferred Stock shall not be considered Prohibited Preferred Stock.

“Properties”: the collective reference to the real and personal property owned, leased, used, occupied or operated, under contract, license or permit, by the Borrower or any Subsidiary.

“Purchase Money Indebtedness” means Indebtedness (other than the Obligations, but including Capitalized Lease Obligations), incurred at the time of, or within ninety (90) days after, the acquisition of any fixed assets for the purpose of financing all or any part of the acquisition cost thereof.

“Purchasing Lender”: as defined in Section 10.6(c) hereof.

“Record”: information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form.

“Reduction Credit”: as defined in Section 2.3(b) hereof.

“Reduction Date”: as defined in Section 2.3(b) hereof.

“Register”: as defined in Section 10.6(e).

“Regulation D”: Regulation D of the Board of Governors of the Federal Reserve System, as the same is from time to time in effect, and all official rulings and interpretations thereunder or thereof and any successor regulation thereto.

“Regulation U”: Regulation U of the Board of Governors of the Federal Reserve System, as the same is from time to time in effect, and all official rulings and interpretations thereunder or thereof and any successor regulation thereto.

“Related Parties”: means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.

“Reorganization”: with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of ERISA.

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“Reportable Event”: the occurrence of any of the events set forth in Section 4043(b) of ERISA with respect to a Plan for which notice to the PBGC is required, other than those events as to which the thirty day notice period is waived under PBGC regulations.

“Requirement of Law”: as to any Person, its Organic Documents, and any law, treaty, rule, order, judgment or regulation of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.

“Responsible Officer”: with respect to any Loan Party, the chief executive officer or president of such Loan Party, or, with respect to financial matters, the chief financial officer of such Loan Party.

“Restatement Closing Date”: the date on which the conditions set forth in Section 4.1 are satisfied.

“Restricted Payments”: as defined in Section 6.6.

“Revolving Commitment Increase”: as defined in Section 2.16(a).

“Revolving Loan”: as defined in Section 2.1(a).

“Revolving Loan Commitment”: the commitment of a Lender to make Revolving Loans as set forth on the signature pages hereof, or in the Assignment and Acceptance or the New Lender Joinder pursuant to which such Lender becomes party to this Agreement, as the case may be, as the same may be adjusted pursuant to the provisions hereof. The aggregate amount of the Revolving Loan Commitments as of the Restatement Closing Date is $45,000,000.

“Revolving Loan Commitment Expiration Date”: May 1, 2016; provided that the term shall be automatically extended (i) for an additional 12 months to May 1, 2017 (the “Outside Maturity Date”) if the MidOcean Entities deliver legal opinions, in form and substance reasonably satisfactory to Agent in Agent’s sole discretion, from Cayman Islands and Delaware counsel to the MidOcean Entities stating that each MidOcean Entity has the right to call capital pursuant to the terms of its Partnership Agreement after the termination of such partnership, or (ii) in the event the terms of the Partnerships are extended after the Closing Date, for an additional number of days (but in no event later than the Outside Maturity Date) equal to ninety (90) days prior to the earliest date on which any Partnership term expires, as set forth in written extension documents delivered to the Agent by the MidOcean Entities; provided, further that, in either case, the satisfaction of such condition set forth in (i) or (ii) shall be acknowledged in writing by the Agent.

“Revolving Loan Commitment Percentage”: with respect to each Lender, the percentage equivalent of the ratio which such Lender’s Revolving Loan Commitment bears to the aggregate Revolving Loan Commitment.

“Revolving Note”: as defined in Section 2.1(d).

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“Secured Parties”: collectively, the Agent, the Lenders and each counterparty to a Lender Hedging Agreement (including a Person who was a Lender at the time such Hedging Agreement was entered into).

“Senior Lender”: City National Bank.

“Senior Credit Agreement”: that certain Amended and Restated Loan and Security Agreement dated as of December 23, 2010 by and between the Borrower and the Senior Lender, as the same may be amended, restated, modified or supplemented in accordance with the terms hereof and the Subordination Agreement.

“Senior Debt Documents”: the Senior Credit Agreement and each security agreement, pledge agreement, mortgage or other security document, each guarantee and all agreements, documents and instruments executed and/or delivered pursuant thereto or in connection therewith, as the same may be amended, restated, modified or supplemented in accordance with the terms hereof and the Subordination Agreement.

“Senior Indebtedness”: the Indebtedness outstanding under the Senior Debt Documents.

“Shareholder Guarantee”: a guarantee made by a Shareholder Guarantor in favor of the Agent, for the benefit of the Lenders, in form and substance reasonably satisfactory to the Agent, as the same may be amended, restated, modified or supplemented in accordance with the terms hereof.

“Shareholder Guarantors”: the “Management” Guarantors and the “Freshpet Investors” Guarantors set forth on Schedule 1.1(a).

“Single Employer Plan”: any Plan which is covered by Title IV of ERISA, but which is not a Multiemployer Plan.

“Solvent”: with respect to any Person on a particular date, that, at fair valuations, the sum of such Person’s assets is greater than all of such Person’s debts.

“Subordinated Debt”: Indebtedness of Borrower that is on terms and conditions (including payment terms, interest rates, covenants, remedies, defaults and other material terms) satisfactory to the Agent and which (a) has been expressly subordinated in right of payment to all Obligations by the execution and delivery of a subordination agreement, in form and substance satisfactory to the Agent, in its sole discretion, prior to the incurrence of such indebtedness and (b) if such Indebtedness is secured by a Lien, such Lien is expressly subordinated to the Liens granted to Agent by the execution and delivery of a subordination agreement, in form and substance satisfactory to the Agent, in its sole discretion, prior to the creation of such Lien.

“Subordination Agreement”: the Subordination Agreement dated as of the date hereof between the Agent and the Senior Lender, as the same may be amended, restated, modified or supplemented in accordance with the terms hereof.

“Subsidiary”: as to any Person at any time of determination, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests

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having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries or Subsidiaries, or both, by such Person. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.

“Subsidiary Guarantee”: the Subsidiary Guarantee made by each Subsidiary in favor of the Agent, for the benefit of the Lenders, in form and substance reasonably satisfactory to the Agent, as the same may be amended, restated, modified or supplemented in accordance with the terms hereof.

“Supporting Obligation”: a letter-of-credit right or secondary obligation that supports the payment or performance of an Account, chattel paper, document, General Intangible, instrument, or Investment Property.

“Taxes”: as defined in Section 2.12 hereof.

“Termination Event”: (a) a Reportable Event, (b) the institution of proceedings to terminate a Single Employer Plan by the PBGC under Section 4042 of ERISA, (c) the appointment by the PBGC of a trustee to administer any Single Employer Plan or (d) the existence of any other event or condition that would reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment by the PBGC of a trustee to administer, any Single Employer Plan.

“Total Debt”: as of any date of determination, without duplication, the remainder of (a) all Indebtedness for borrowed money of such Person, determined on a consolidated basis in accordance with GAAP (other than Subordinated Debt and Preferred Stock that is not Prohibited Preferred Stock), including, in any event, but without duplication, with respect to Borrower and its Subsidiaries, the Revolving Loans, and the amount of their Capitalized Lease Obligations, in each case exclusive of Indebtedness owed by one Loan Party to another Loan Party and any Indebtedness in respect of any of the foregoing less (b) all cash and Cash Equivalents on the balance sheet of the Borrower and its Subsidiaries at such date.

“Trailing Twelve-Month Revenues”: for the Borrower and its Subsidiaries on a consolidated basis, for the fiscal quarter most recently ended and the immediately preceding three fiscal quarters, consolidated gross revenue.

“Tranche”: the collective reference to LIBOR Loans the Interest Periods with respect to all of which begin on the same date and end on the same later date (whether or not such LIBOR Loans shall originally have been made on the same day).

“Transferee”: as defined in Section 10.6(g) hereof.

“Type”: as to any Revolving Loan, its nature as a Base Rate Loan or a LIBOR Loan.

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“UCC”: the Uniform Commercial Code as in effect in the State of New York or any other applicable jurisdiction.

1.2 Other Definitional Provisions. (a) Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in any other Loan Document or any certificate or other document made or delivered pursuant hereto or thereto.

(b) As used herein, in any other Loan Document, and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in Section 1.1 and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP. Unless otherwise provided herein, all financial calculations made with respect to the Borrower for the purpose of determining compliance with the terms of this Agreement shall be made on a consolidated basis and in accordance with GAAP.

(c) The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, subsection, Schedule and Exhibit references are to this Agreement unless otherwise specified. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.

(d) Any financial ratios required to be maintained by the Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed in this Agreement and rounding the result up or down to the nearest number (with a round-up if there is no nearest number) to the number of places by which such ratio is expressed in this Agreement.

(e) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

(f) References to agreements, other contractual instruments and other documents include all subsequent amendments and other modifications to such agreement and documents, but only to the extent such amendments and other modifications are not prohibited by the terms of any Loan Document.

SECTION 2. AMOUNT AND TERMS OF REVOLVING LOANS; COMMITMENT AMOUNTS

2.1 Revolving Loans; Revolving Loan Commitments. (a) Effective as of the Restatement Closing Date, upon satisfaction of the conditions precedent set forth in Section 4.1, all “Revolving Loans” (as defined in the Existing Credit Agreement) outstanding under the Existing Credit Agreement shall be deemed outstanding under this Agreement. All Interest Periods for LIBOR Loans, if any, that have commenced and are continuing under the Existing Credit Agreement shall be deemed to have been elected pursuant to and outstanding under this Agreement, in each case with same remaining term as existing immediately prior to the Restatement Closing Date.

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(b) Subject to the terms and conditions hereof, each Lender severally agrees to make loans on a revolving credit basis to the Borrower from time to time from and including the Restatement Closing Date to but excluding the Revolving Loan Commitment Expiration Date (each a “Revolving Loan,” and collectively, the “Revolving Loans”) in accordance with the terms of this Agreement; provided, however, that the aggregate principal amount of all Revolving Loans outstanding shall not exceed the Maximum Revolving Amount at any time. Within the limits of each Lender’s Revolving Loan Commitment and the Maximum Revolving Amount, the Borrower may borrow, prepay and reborrow Revolving Loans.

With respect to each Lender, the principal amount of each Revolving Loan to be made by such Lender shall be in an amount equal to the product of (i) such Lender’s Revolving Loan Commitment Percentage (expressed as a fraction) and (ii) the total amount of the Revolving Loan(s) requested; provided that in no event shall any Lender be obligated to make a Revolving Loan if after giving effect to such Revolving Loan the sum of such Lender’s Revolving Loans outstanding would exceed its Revolving Loan Commitment or if such Lender’s Revolving Loan Commitment Percentage of such requested Revolving Loan is in excess of such Lender’s Available Revolving Loan Commitment.

(c) Subject to Sections 2.9 and 2.10, the Revolving Loans may from time to time be (i) LIBOR Loans, (ii) Base Rate Loans or (iii) a combination thereof, as determined by the Borrower and notified to the Agent in accordance with either Section 2.1(d) or 2.4. Notwithstanding any provision in this Agreement to the contrary, all Revolving Loans borrowed on the Closing Date shall be Base Rate Loans, subject to conversion in accordance with Section 2.4.

(d) Each Lender shall maintain in its internal records an account or accounts evidencing the Indebtedness of the Borrower to such Lender, including the amounts of the Revolving Loans made by it and each repayment and prepayment in respect thereof. Any such recordation shall be conclusive and binding on the Borrower, absent manifest error; provided, failure to make any such recordation, or any error in such recordation, shall not affect any Lender’s Revolving Loan Commitment or the Borrower’s Obligations in respect of any Revolving Loans; and provided further, in the event of any inconsistency between the Register and any Lender’s records, the recordations in the Register shall govern. If so requested by any Lender by written notice to the Borrower (with a copy to the Agent), the Borrower shall execute and deliver to such Lender a promissory note of the Borrower, substantially in the form of Exhibit A (a “Revolving Note”) to evidence such Lender’s Revolving Loans.

(e) The Borrower shall give the Agent irrevocable written notice, substantially in the form of a Borrowing Notice (which notice must be received by the Agent prior to 10:00 a.m., Los Angeles time, at least one Business Day prior to the proposed borrowing date or, if all or any part of the Revolving Loans are requested to be made as LIBOR Loans, at least three (3) Eurodollar Business Days prior to the proposed borrowing date) requesting that the Lenders make Revolving Loans on the proposed borrowing date and specifying (i) the aggregate amount of Revolving Loans requested to be made, (ii) subject to Sections 2.9 and 2.11, whether the Revolving Loans are to be LIBOR Loans, Base Rate Loans or a combination thereof and (iii) if the Revolving Loans are to be entirely or partly LIBOR Loans, the respective amounts of each such Type of Revolving Loan and the respective lengths of the initial Interest Periods therefor.

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Notwithstanding the foregoing, such notice may be given by telephone, provided it is promptly confirmed on the same day in writing by delivery to the Agent of a written notice, substantially in the form of a Borrowing Notice. Upon receipt of such notice, the Agent shall promptly notify each Lender thereof on the date of receipt of such notice. On the proposed borrowing date, not later than 10:00 a.m., Los Angeles time, each Lender shall make available to the Agent the amount of such Lender’s pro rata share of the aggregate borrowing amount (as determined in accordance with the second paragraph of Section 2.1(a)) in immediately available funds by wiring such amount to such account as the Agent shall specify. The Agent may, in the absence of notification from any Lender that such Lender has not made its pro rata share available to the Agent on such date, credit the account of the Borrower on the books of the Agent (or credit such other account as the Borrower shall instruct the Agent in writing) with the aggregate amount of Revolving Loans.

(f) Neither the Agent nor any Lender shall be responsible for the obligations or Revolving Loan Commitment of any other Lender hereunder, nor will the failure of any Lender to comply with the terms of this Agreement relieve any other Lender or the Borrower of its obligations under this Agreement. In the event that, at any time when the conditions set forth for borrowing in Section 4.2 have been satisfied, a Lender for any reason fails or refuses to fund its portion of a borrowing hereunder (a “Defaulting Lender”), then, until such time as such Lender has funded its portion of such borrowing, such Defaulting Lender shall not have the right (i) to vote regarding any issue on which voting is required under this Agreement or any other Loan Document, and the amount of the Commitments and Loans of such Lender shall not be counted as outstanding for purposes of determining issues requiring the vote or consent of all “Lenders” or “Majority Lenders” hereunder or (ii) to receive payments of principal, interest or fees in respect of such Lender’s unfunded borrowing. If the Agent shall fund any Revolving Loan of a Defaulting Lender in accordance with Section 2.1(d) (it being agreed that the Agent shall have no obligation to do so), then such Lender shall be obligated to immediately repay such Revolving Loan to the Agent, with interest thereon at the Federal Funds Effective Rate for each day from the date of funding by the Agent until such amount is paid in full. If such amount is not paid by the Defaulting Lender within two (2) Business Days, then the Borrower shall be obligated to thereupon repay such amount to the Agent with interest thereon at the applicable rate specified in Section 2.6.

(g) The Revolving Loan Commitment of each Lender shall terminate on the Revolving Loan Commitment Expiration Date.

(h) Subject to Section 2.3(b), all outstanding Revolving Loans shall be due and payable on the Revolving Loan Commitment Expiration Date.

2.2 Optional Prepayments; Optional Commitment Reductions. Upon at least three (3) Business Days’ irrevocable written notice in the case of LIBOR Loans and upon at least one Business Day’s irrevocable written notice in the case of Base Rate Loans, from the Borrower to the Agent, specifying the date and amount of prepayment and/or commitment reduction and, if a prepayment, whether the prepayment is of LIBOR Loans, Base Rate Loans or a combination thereof and, if of a combination thereof, the amount allocable to each, the Borrower may at any time and from time to time, subject to Section 2.13, prepay the Revolving Loans and/or permanently reduce the aggregate Revolving Loan Commitment, in whole or in part. Upon

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receipt of any such notice from the Borrower, the Agent shall promptly notify each Lender thereof. If any such notice is given, the amount specified in such notice shall be due and payable by the Borrower on the date specified therein, together with accrued interest to such date on the amount prepaid. Partial prepayments of Revolving Loans shall be in the aggregate principal amount of $500,000 or an integral multiple of $100,000 in excess thereof. Upon any permanent reduction in the aggregate Revolving Loan Commitments as contemplated by this Section 2.2, 2.3(b) or Section 6.5(a), each Covered Amount shall be deemed reduced by a proportionate amount on a pro rata basis for each Guarantor set forth on Schedule 1.1(a) as calculated by the Agent and the Agent may, at its election, attach, and circulate to the Borrower and the Lenders, a replacement Schedule 1.1(a) to this Agreement reflecting such reduced amounts which shall thereafter be deemed the applicable Schedule 1.1(a).

2.3 Mandatory Prepayments; Mandatory Commitment Reductions.

(a) If at any time the aggregate principal amount of all Revolving Loans outstanding exceeds the applicable Maximum Revolving Amount, then the Borrower shall immediately, without notice or request by the Agent, prepay the Revolving Loans in an aggregate amount equal to such excess; provided that any such excess caused by the existence of one or more Non-Compliant Guarantors shall be subject to Section 7.2.

(b) The Revolving Loan Commitments shall automatically and permanently reduce on each of the last day of each calendar quarter set forth below, commencing with the calendar quarter ending December 31, 2014 (each, a “Reduction Date”), in each case by the applicable percentage set forth below of the aggregate Revolving Loan Commitment in effect immediately prior to such reduction:

Reduction Date	Percentage
December 31, 2015		[12.50	]%
March 31, 2015 through September 30, 2016		3.125	%
December 31, 2016 and each quarter thereafter		3.750	%

Notwithstanding the foregoing, any voluntary reduction in the aggregate Revolving Loan Commitment made by the Borrower pursuant to Section 2.2 shall reduce the amount by which the Aggregate Revolving Loan Commitment must be reduced pursuant to this Section 2.3(b) by a corresponding amount (such amount, a “Reduction Credit”), such Reduction Credit to be applied to such remaining Reduction Date(s) as the Borrower shall indicate in writing to the Agent, provided that if the Borrower fails to indicate such application, then the Reduction Credit shall be applied to the remaining Reduction Dates in inverse order of maturity.

If upon any reduction set forth above, the aggregate principal amount of all Revolving Loans outstanding exceeds the Maximum Revolving Amount, then the Borrower shall immediately, without notice or request by the Agent, prepay the Revolving Loans in an

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aggregate amount equal to such excess. Each such prepayment shall be accompanied by payment in full of all accrued interest and, if applicable, accrued commitment fees thereon to and including the date of such prepayment, together with any additional amounts owing pursuant to Section 2.14. No such amounts shall be available for reborrowing.

2.4 Conversion and Continuation Options. (a) The Borrower may elect from time to time to convert LIBOR Loans to Base Rate Loans, by the Borrower giving the Agent at least two (2) Business Days’ prior irrevocable written notice of such election pursuant to a Continuation Notice, provided that any such conversion of LIBOR Loans may only be made on the last day of an Interest Period with respect thereto. Subject to Sections 2.9 and 2.11 and so long as no Event of Default shall have occurred and is then continuing, the Borrower may elect from time to time to convert Base Rate Loans to LIBOR Loans by the Borrower giving the Agent at least three (3) Eurodollar Business Days’ prior irrevocable written notice of such election pursuant to a Continuation Notice. Any such notice of conversion to LIBOR Loans shall specify the length of the initial Interest Period or Interest Periods therefor. All or any part of outstanding LIBOR Loans and, subject to Sections 2.9 and 2.11, Base Rate Loans, may be converted as provided herein, provided that (i) any such conversion may only be made if, after giving effect thereto, Section 2.5 shall not have been contravened and (ii) no such Revolving Loan may be converted into a LIBOR Loan after the date that is one month prior to the Revolving Loan Commitment Expiration Date.

(b) Any LIBOR Loan may be continued as such upon the expiration of the then current Interest Period with respect thereto by the Borrower giving notice to the Agent, in accordance with the applicable provisions of the term “Interest Period” set forth in Section 1.1, of the length of the next Interest Period to be applicable to such LIBOR Loan, provided that no LIBOR Loan may be continued as such (i) if, after giving effect thereto, Section 2.5 would be contravened, (ii) after the date that is one month prior to the Revolving Loan Commitment Expiration Date or (iii) if an Event of Default shall have occurred and be continuing unless the Agent consents, and provided, further, that if the Borrower shall fail to give any required notice as described above in this Section or if such continuation is not permitted pursuant to the preceding proviso, such Revolving Loans shall be automatically converted to Base Rate Loans on the last day of such then-expiring Interest Period.

2.5 Minimum Amounts of Tranches; Minimum Borrowings. All borrowings, conversions and continuations of LIBOR Loans hereunder and all selections of Interest Periods hereunder shall be in such amounts and be made pursuant to such elections so that, after giving effect thereto, the aggregate principal amount of the Revolving Loans comprising each Tranche shall be equal to $1,000,000 or a whole multiple of $100,000 in excess thereof and, in any case, there shall not be more than six Tranches, unless otherwise agreed to by the Agent in its sole discretion. All borrowings of Base Rate Loans shall be in a minimum amount of $500,000 or a whole multiple of $100,000 in excess thereof, unless otherwise agreed to by the Agent in its sole discretion.

2.6 Interest Rates and Payment Dates.

(a) Each Revolving Loan shall (i) if a LIBOR Loan, bear interest for each day during each Interest Period with respect thereto at a rate per annum equal to the LIBOR Adjusted Rate plus 3.25% and (ii) if a Base Rate Loan, bear interest at a rate per annum equal to the Base Rate plus 2.25%.

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(b) If any Event of Default shall have occurred and be continuing, all amounts outstanding hereunder shall, at the election of the Majority Lenders in their sole discretion, bear interest at a rate per annum equal to the rate determined pursuant to Section 2.6(a) plus 2% per annum, from the date of the occurrence of such Event of Default until such Event of Default is no longer continuing (after as well as before judgment).

(c) Interest shall be payable in arrears on each Interest Payment Date; provided, however, that interest accruing pursuant to paragraph (b) of this Section shall be payable on demand.

2.7 Computation of Interest and Fees. Interest on LIBOR Loans shall be calculated on the basis of a year of three hundred sixty (360) days, for the actual days elapsed, and interest on Base Rate Loans and all other Obligations shall be calculated on the basis of a year of 365/366 days, for the actual days elapsed. Each determination of an interest rate by the Agent pursuant to any provision of this Agreement shall be conclusive and binding on the Borrower and the Lenders in the absence of manifest error.

2.8 Inability to Determine Interest Rate. In the event that, prior to the first day of any Interest Period, (a) the Agent shall have determined (which determination shall be conclusive and binding upon the Borrower absent manifest error) that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the LIBOR Adjusted Rate for such Interest Period or (b) the Agent shall have received notice from the Majority Lenders acting that the LIBOR Adjusted Rate determined or to be determined for such Interest Period will not adequately and fairly reflect the cost to such Lenders (as conclusively certified by such Lenders) of making or maintaining their affected Revolving Loans during such Interest Period, the Agent shall give telecopy or telephonic notice thereof to the Borrower and the Lenders as soon as practicable thereafter. If such notice is given, (i) any LIBOR Loans requested to be made on the first day of such Interest Period shall accrue interest at the Base Rate, (ii) Revolving Loans that were to have been converted on the first day of such Interest Period to LIBOR Loans shall be continued as Base Rate Loans and (iii) any outstanding LIBOR Loans shall be converted, on the first day of such Interest Period, to Base Rate Loans. Until such notice has been withdrawn by the Agent, no further LIBOR Loans shall be made or continued as such, nor shall the Borrower have the right to convert Base Rate Loans to LIBOR Loans.

2.9 Pro Rata Treatment and Payments. Each payment (including each prepayment) by the Borrower on account of principal of and interest on the Revolving Loans shall be made pro rata according to the respective Revolving Commitment Percentages then held by the Lenders. All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest, fees or otherwise, shall be made without setoff, deduction or counterclaim and shall be made prior to 11:00 a.m., Los Angeles time, on the due date thereof to the Agent, for the account of the Lenders, at its office specified in Section 10.2, in Dollars and in immediately available funds. The Agent shall distribute such payments to the applicable Lenders promptly upon receipt in like funds as received. If any payment hereunder (other than payments on the LIBOR Loans) becomes due and payable on a day other than a Business Day, such

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payment shall be extended to the next succeeding Business Day, and, with respect to payments of principal, interest thereon shall be payable at the then applicable rate during such extension. If any payment on a LIBOR Loan becomes due and payable on a day other than a Eurodollar Business Day, the maturity thereof shall be extended to the next succeeding Eurodollar Business Day (and interest shall continue to accrue thereon at the applicable rate) unless the result of such extension would be to extend such payment into another calendar month, in which event such payment shall be made on the immediately preceding Eurodollar Business Day. The Borrower authorizes the Agent to debit any of its bank accounts with the Agent or to make a draw of Revolving Loans for the purpose of effecting payment of principal, interest or other costs and expenses payable by the Borrower to the Agent or any Lender under this Agreement.

2.10 Illegality. Notwithstanding any other provision herein, if any Lender determines that any Requirement of Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful for such Lender to maintain LIBOR Loans as contemplated by this Agreement, (a) the commitment of such Lender hereunder to continue LIBOR Loans as such and convert Base Rate Loans to LIBOR Loans shall forthwith be suspended during such period of illegality and (b) the Revolving Loans of such Lender then outstanding as LIBOR Loans, if any, shall be converted automatically to Base Rate Loans on the respective last days of the then current Interest Periods with respect to such Revolving Loans or within such earlier period as required by law. If any such conversion of a LIBOR Loan occurs on a day which is not the last day of the then current Interest Period with respect thereto, the Borrower shall pay to such Lender such amounts, if any, as may be required pursuant to Section 2.13. To the extent that a Lender’s LIBOR Loans have been converted to Base Rate Loans pursuant to this Section 2.10, all payments and prepayments of principal that otherwise would be applied to such Lender’s LIBOR Loans shall be applied instead to its Base Rate Loans.

2.11 Increased Costs. (a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement reflected in the LIBOR Adjusted Rate);

(ii) subject the Agent or any Lender to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii) impose on any Lender or the London interbank market any other condition, cost or expense (other than Taxes) affecting this Agreement or Revolving Loans made by such Lender;

and the result of any of the foregoing shall be to increase the cost to the Agent or such Lender of making, converting to, continuing or maintaining any Revolving Loan or of maintaining its obligation to make any such Revolving Loan, or to reduce the amount of any sum received or receivable by the Agent or such Lender hereunder (whether of principal, interest or any other

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amount) then, upon request of the Agent or such Lender, the Borrower will pay to the Agent or such Lender, as the case may be, such additional amount or amounts as will compensate the Agent or such Lender, as the case may be, for such additional costs incurred or reduction suffered.

(b) If any Lender determines that any Change in Law affecting such Lender or any lending office of such Lender or such Lender’s holding company, if any, regarding capital or liquidity requirements, has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement, the Revolving Loan Commitments of such Lender or the Revolving Loans made by such Lender, to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender, as the case may be, such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

(c) A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section and delivered to the Borrower, shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.

(d) Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs incurred or reductions suffered more than nine months prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions, and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).

2.12 Taxes. All payments made by the Borrower in respect of the Obligations shall be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority or any political subdivision or taxing authority thereof or therein, other than Excluded Taxes (all such non-Excluded Taxes being hereinafter called “Taxes”). If any Taxes are required to be withheld from any amounts payable to the Agent or any Lender in respect of the Obligations, then, except to the extent attributable to the gross negligence or willful delay of the Agent or any Lender, the amounts so payable to the Agent or such Lender shall be increased to the extent necessary to yield to the Agent or such Lender (after payment of all Taxes) interest or any such other amounts payable hereunder at the rates or in the amounts specified in this Agreement. The Borrower agrees to indemnify the Agent and the Lenders for the full amount of Taxes (including any Taxes imposed or asserted by any Governmental Authority on amounts payable under this Section), paid by the Agent and/or any Lender.

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Whenever any Taxes are payable by the Borrower, as promptly as possible thereafter, the Borrower shall send to the Agent a copy of an original official receipt received by the Borrower showing payment thereof or such other evidence of payment reasonably satisfactory to the Agent. If the Borrower fails to pay any Taxes when due to the appropriate taxing authority or fails to remit to the Agent the required receipts or other required documentary evidence, the Borrower shall indemnify the Agent and each Lender for any incremental taxes, interest or penalties, except to the extent attributable to the gross negligence or willful delay of the Agent or any Lender (and related reasonable fees and expenses of counsel) that may become payable by the Agent or any Lender as a result of any such failure. The agreements in this Section shall survive the termination of this Agreement and the payment of the Revolving Loans and all other Obligations.

2.13 Indemnity. The Borrower agrees to indemnify each Lender and to hold each Lender harmless from and to pay each Lender on demand the amount of any liability, loss or expense arising from the reemployment of funds obtained by it or from fees payable to terminate the deposits from which such funds were obtained (including reasonable fees and expenses of counsel) which such Lender may sustain or incur as a consequence of (a) default by the Borrower in payment when due of the principal amount of or interest on any LIBOR Loan, (b) default by the Borrower in making a borrowing of, conversion into or continuation of LIBOR Loans after the Borrower has given a notice requesting the same in accordance with the provisions of this Agreement, (c) default by the Borrower in making any prepayment after the Borrower has given a notice thereof in accordance with the provisions of this Agreement or (d) the making by the Borrower of a prepayment or conversion of LIBOR Loans on a day which is not the last day of an Interest Period with respect thereto (including any prepayment required as a result of acceleration of the Revolving Loans under Article 7). Such Lender’s certificate as to such liability, loss or expense shall be deemed conclusive, absent manifest error. This covenant shall survive the termination of this Agreement and the payment of the Revolving Loans and all other Obligations.

2.14 Mitigation of Costs. If any Lender, by taking any reasonable action, so long as making such change or taking such other action is not disadvantageous to it in any financial, regulatory or other respect, can mitigate any adverse effect on the Borrower under Section 2.11 or 2.13, such Lender shall take such action.

2.15 Unused Commitment Fee. The Borrower agrees to pay to the Agent, for the account of the Lenders, an unused commitment fee for the period from and including the Closing Date to but excluding the Revolving Loan Commitment Expiration Date, based on the aggregate amount, for each day during such period, of the Available Revolving Loan Commitments, and computed at a rate equal to (i) 1.00%, if average usage during such period is less than 25%, (ii) 0.75%, if average usage during such period is greater than or equal to 25% but less than 50%, (iii) 0.50%, if average usage during such period is greater or equal to 50% but less than 75% and (iv) 0.00%, if average usage during such period is greater than 75%.

Such unused commitment fee shall be payable in installments quarterly in arrears on the last Business Day of each March, June, September and December and on the Revolving Loan Commitment Expiration Date.

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2.16 Increase of Revolving Commitments. (a) The Borrower may, by written notice to the Agent (a “Commitment Increase Notice”), at any time request increases of the aggregate Revolving Commitment (a “Revolving Commitment Increase”); provided that (i) the aggregate amount of Revolving Commitment Increases occurring after the Restatement Closing Date shall not result, at any time, in aggregate Revolving Loan Commitments in excess of $60,000,000 (unless the Majority Lenders shall otherwise commit in writing); (ii) each exercise of the increase request option shall be in a minimum principal amount of not less than $5,000,000; and (iii) no such increase may be requested when a Default or Event of Default has occurred and is continuing. Each such notice shall specify (A) the date (each, an “Increased Amount Date”) on which Borrower proposes that the Revolving Commitment Increase shall be effective and (B) the requested amount of such increase. Notwithstanding any term of this Agreement to the contrary, neither the Agent nor any Lender shall be deemed to have committed to any Revolving Commitment Increase unless such Lender executes and delivers an Increased Commitment Letter (as defined below); for the avoidance of doubt, any Lender may accept or decline to provide a Revolving Commitment Increase in its sole discretion.

(b) Upon receipt of a Commitment Increase Notice, the Agent shall forward a copy thereof to each Lender, and each Lender shall have the right, but not the obligation, to participate in such increase in an amount equal to its pro rata share, immediately prior to the effectiveness of any such increase, in the Revolving Loan Commitments. Any Lender electing to participate in such increase must forward its written commitment therefor (an “Increased Commitment Letter”) to the Agent within five (5) Business Days of delivery of such notice. (The failure of a Lender to deliver an Increased Commitment Letter to the Agent within such time period shall be deemed a rejection by such Lender of the option to participate in such Revolving Commitment Increase.

(c) In the event that the Revolving Commitment Increase requested by the Borrower is not fully committed to by existing Lenders, the Borrower may designate one or more new Lenders (each, a “New Lender”), approved by the Agent (such approval not to be unreasonably withheld or delayed) to provide the amount of such unallocated excess Revolving Commitment Increase. Each New Lender shall become a Lender pursuant to a joinder agreement substantially in the form attached as Exhibit G (a “New Lender Joinder”) hereto or otherwise in form and substance satisfactory to the Agent. Subject to the foregoing, final allocations with respect to any Revolving Commitment Increase shall be determined by the Borrower and the Agent.

SECTION 3. REPRESENTATIONS AND WARRANTIES

To induce the Agent and the Lenders to enter into this Agreement and to make the Revolving Loans, the Borrower hereby represents and warrants to the Agent and the Lenders that:

3.1 Financial Condition. Each of the Financial Statements (i) is complete and correct in all material respects, is consistent with the books and records of the Borrower (which are accurate and complete in all material respects); (ii) accurately and completely, in all material respects, presents the financial condition, assets, and liabilities of the Borrower as of its respective date and the results of operations, changes in owners’ equity, and cash flows for the

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applicable period; and (iii) has been prepared in accordance with GAAP consistently applied throughout the periods covered thereby. As of the Restatement Closing Date, neither the Borrower nor any of its Subsidiaries has any contingent liability or liability for taxes, long-term lease or unusual forward or long-term commitment that is not reflected in the Financial Statements or the notes thereto. Since December 31, 2011, there has been no event or condition resulting in a Material Adverse Effect.

3.2 Corporate Existence; Compliance with Law, Etc. Each Loan Party (a) is duly organized, validly existing and in good standing (or the local equivalent) under the laws of the jurisdiction of its organization, (b) has the corporate, partnership or limited liability company power, as the case may be, and authority, and the legal right, to own and operate its Properties, to lease the property it operates as lessee and to conduct the business in which it is currently engaged and in which it proposes to be engaged after the Closing Date, (c) is duly qualified as a foreign entity and in good standing under the laws of each jurisdiction where its ownership, lease or operation of property or the conduct of its business requires such qualification, each of which jurisdictions is, as of the Restatement Closing Date, set forth on Schedule 3.2 hereto and (d) is in compliance in all material respects with all applicable material Requirements of Law, except in the case of clauses (b), (c) and (d) where the failure to be so would not reasonably be expected to have a Material Adverse Effect.

3.3 Corporate Power; Authorization; Consents; Enforceable Obligations. (a) Each Loan Party has the corporate, partnership or limited liability company power, as the case may be, and authority, and the legal right, to make, deliver and perform the Loan Documents to which it is or will be a party, and to borrow hereunder (in the case of the Borrower), and the Borrower has taken all necessary corporate, partnership or limited liability action, as applicable, to authorize (i) the borrowings on the terms and conditions of this Agreement and (ii) the execution, delivery and performance of the Loan Documents to which it is or will be a party.

(b) No consent or authorization of, filing with or other act by or in respect of, any Governmental Authority or any other Person is required in connection with the borrowings hereunder or the execution, delivery and performance by the Loan Parties or the validity or enforceability against the each of the Loan Parties of this Agreement and the other Loan Documents to which it is a party except for any consent, authorization, filing or other act which has been made or obtained and is in full force and effect. This Agreement has been, and each of the other Loan Documents to which each of the Loan Parties is or will be a party will be, duly executed and delivered by it. This Agreement constitutes, and each of the other Loan Documents when executed and delivered will constitute, a legal, valid and binding obligation of each of the Loan Parties (to the extent such Loan Party is a party thereto) enforceable against it in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).

3.4 No Legal Bar. The execution, delivery and performance of this Agreement and the other Loan Documents, the borrowings hereunder and the use of the proceeds thereof, will not violate in any material respect any Requirement of Law applicable to any of the Loan Parties or material Contractual Obligation of any of the Loan Parties, and will not result in, or require,

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the creation or imposition of any Lien on any of its properties or revenues pursuant to any such Requirement of Law or such material Contractual Obligation, except as permitted by to the Loan Documents.

3.5 No Material Litigation. Except as set forth in Schedule 3.5, there are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of the Loan Parties after due investigation, threatened, at law, in equity, in arbitration or before any Governmental Authority, by or against any Loan Party or against any of their properties or revenues that (a) purport to affect or pertain to this Agreement, any other Loan Document, or (b) either individually or in the aggregate could reasonably be expected to have a Material Adverse Effect.

3.6 Ownership of Property; Liens; Condition of Properties. Each of the Loan Parties has good and marketable title to all Properties purported to be owned thereby, free and clear of any Liens, except those permitted by Section 6.3 or where the failure to do so would reasonably be expected to have a Material Adverse Effect. None of the Loan Parties has used (or permitted the filing of any financing statement under) any legal or operating name at any time during the five years immediately preceding the execution of this Agreement, except as identified on Schedule 3.6.

3.7 Environmental Matters. (a) Each item of real Property owned, leased or occupied by the Borrower or any Subsidiary, and all operations at the real Properties owned, leased or occupied by the Borrower or any Subsidiary, are in compliance with all applicable Environmental Laws, except for such noncompliance that could not reasonably be expected to have a Material Adverse Effect.

(b) There is no contamination at, under or about such Properties, or violation of any Environmental Law with respect to such Properties or the business conducted at such Properties which involves a matter or matters which has caused or could reasonably be expected to cause a Material Adverse Effect.

(c) No Loan Party has received any notice from any Governmental Authority of violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters or compliance with Environmental Laws with regard to any of the Properties or the business conducted at the Properties, nor does the Borrower have knowledge that any such notice will be received or is being threatened.

(d) No judicial proceedings or governmental or administrative action is pending, or, to the knowledge of the Borrower, threatened, under any Environmental Law to which any Loan Party is named as a party with respect to the Properties or the business conducted at the Properties, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements outstanding under any Environmental Law with respect to such Properties or such business that could reasonably be expected to have a Material Adverse Effect.

3.8 Intellectual Property. Each of the Loan Parties owns, or holds licenses in, all trademarks, trade names, copyrights, patents, patent rights, and licenses that are necessary to the conduct of its business as currently conducted, and attached hereto as Schedule 3.8 (as updated

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from time to time) is a true, correct, and complete listing of all material patents, patent applications, trademarks, trademark applications, copyrights, and copyright registrations as to which such Loan Party is the owner or is an exclusive licensee.

3.9 Taxes. Each of the Loan Parties has filed or caused to be filed all tax returns which are required to be filed by it and has paid all material taxes shown to be due and payable on said returns or on any assessments made against it or any of its property and all other material taxes, fees or other charges imposed on it or any of its property by any Governmental Authority (other than any not yet delinquent or the amount or validity of which are currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided on the books of the applicable Loan Party); and no tax Lien has been filed, and no claim is being asserted with respect to any such material tax, fee or other charge.

3.10 Federal Regulations. No Revolving Loan and no part of the proceeds thereof will be used, directly or indirectly, for “purchasing” or “carrying” any Margin Stock within the respective meanings of each of the quoted terms under Regulation U or for any purpose which violates the provisions of the Regulations of the Board of Governors of the Federal Reserve System. If requested by the Agent, the Borrower will furnish to the Agent a statement to the foregoing effect in conformity with the requirements of Form U-1 referred to in Regulation U.

3.11 ERISA Compliance. None of the Borrower, any of its Subsidiaries, or any of their ERISA Affiliates maintains or contributes to any Benefit Plan.

3.12 Investment Company Act. None of the Loan Parties is required to be registered as an “investment company”, within the meaning of the Investment Company Act of 1940, as amended (the “Investment Company Act”).

3.13 Subsidiaries. As of the Restatement Closing Date, the Borrower has no Subsidiaries other than as set forth on Schedule 3.13.

3.14 Purpose of Revolving Loans. The proceeds of the Revolving Loans are intended to be and shall be used by the Borrower for working capital and general corporate purposes of the Borrower and its Subsidiaries, including for constructing and renovating the Plant, the purchase of equipment and advertising expenses and paying fees and expenses incurred in connection with this Agreement.

3.15 Accuracy and Completeness of Information. All factual information (taken as a whole) furnished by or on behalf of Borrower or its Subsidiaries in writing to the Agent (including all information contained in the Schedules hereto or in the other Loan Documents) for purposes of or in connection with this Agreement, the other Loan Documents, or any transaction contemplated herein or therein is, and all other such factual information (taken as a whole) hereafter furnished by or on behalf of Borrower or its Subsidiaries in writing to the Agent will be, true and accurate, in all material respects, on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material respect at such time in light of the circumstances under which such information was provided. On the Closing Date, and as of the

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date on which any other projections are delivered to the Agent, such projections delivered prior to the Closing Date and in the future represent Borrower’s good faith estimate of its and its Subsidiaries’ future performance for the periods covered thereby at the time such projections were delivered (it being understood that actual results may vary from such forecasts and that such variances may be material).

3.16 [Intentionally Omitted].

3.17 [Intentionally Omitted].

3.18 [Intentionally Omitted].

3.19 Capital Structure and Equity Ownership. Schedule 3.19 hereto accurately and completely discloses, as of the Restatement Closing Date, (i) the number and classes of equity ownership rights and interests in the Borrower and each Subsidiary (whether existing as common or preferred stock, general or limited partnership interests, or limited liability company membership interests, or warrants, options or other instruments convertible into such equity) and (ii) the ownership thereof. All such shares and interests are validly existing, fully paid and non-assessable.

3.20 Insolvency. The Loan Parties are and, upon the making of any Revolving Loan on any date on which this representation and warranty is made, will be, taken as a whole, Solvent.

SECTION 4. CONDITIONS PRECEDENT

4.1 Conditions to Restatement Closing Date. The agreement of the Agent and each Lender to amend and restate the Existing Credit Agreement on the terms set forth herein, and the Agreement of each Lender to make the Revolving Loans requested to be made by it on the Restatement Closing Date, if any, is subject to the satisfaction, in each case in form and substance acceptable to the Agent, immediately prior to or concurrently with the making of any such Revolving Loans on the Restatement Closing Date, of the following conditions precedent:

(a) Credit Agreement. The Agent shall have received this Agreement, executed and delivered by the Borrower and each Lender.

(b) Plant Mortgage Modification. The Agent shall have received a modification to the Plant Mortgage reflecting the increased Revolving Loan Commitments, duly executed and notarized by the Borrower and in recordable form, along with the commitment of the relevant title insurance company to issue an endorsement to the Agent’s title policy with respect to the Plant Mortgage, insuring the continuing priority of the Agent’s Lien thereunder.

(c) Other Loan Documents. The Agent shall have received, (i) with respect to the Mid-Ocean Equity Contribution Agreement and each Shareholder Guarantee, an amendment, restatement or other document acceptable to the Agent increasing the amount covered by, and reaffirming the obligations under, such Equity Contribution Agreement or Guarantee and (ii) an amendment to the Subordination Agreement, duly executed by the Senior Lender and the Borrower.

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(d) Resolutions. The Agent shall have received a copy of the resolutions of the Board of Directors, or similar governing body, of (i) the Borrower, authorizing this Agreement and the increased Revolving Loan Commitments and (ii) each Shareholder Guarantor that is a corporation, limited liability company or partnership, authorizing the increase in, and reaffirmation of, its Guarantee, in each case certified by an appropriate officer of such Person, as of the Restatement Closing Date, which certificate states that the resolutions thereby certified have not been amended, modified, revoked or rescinded and are in full force and effect.

(e) Organizational Documents, Etc. The Agent shall have received (i) a certificate of an appropriate officer of the Borrower to the effect that the incumbency certificate and Organic Documents of each Loan Party delivered to the Agent in connection with the Existing Credit Agreement remain true and correct with no amendments thereto and (ii) a certificate of the General Partner of each Mid-Ocean Entity to the effect that the Partnership Agreements (including the amendments thereto) delivered to the Agent in connection with the Existing Credit Agreement remain true and correct with no additional amendments thereto.

(f) Costs. The Agent shall have received payment or evidence of payment by the Borrower of all costs, expenses and taxes (including those payable pursuant to Section 10.5), including reasonable legal fees of Agent’s counsel to the extent requested to be paid by the Agent, accrued and unpaid and otherwise due and payable on or before the Restatement Closing Date by the Borrower pursuant to this Agreement.

(g) Legal Opinion. The Agent shall have received the executed legal opinions of (i) Kirkland & Ellis, counsel to the Loan Parties and to the MidOcean Entities and (ii) local Cayman Island counsel for the MidOcean Entities, each in form and substance reasonably satisfactory to the Agent and dated the Restatement Closing Date.

(h) No Default/Representations. No Default or Event of Default shall have occurred and be continuing on the Restatement Closing Date, and the representations and warranties contained in each certificate or other writing delivered to the Agent by any Loan Party in connection with this Agreement prior to or on the Restatement Closing Date, except to the extent such representations and warranties expressly relate to an earlier date, shall be correct in all material respects (except for those representations and warranties that are conditioned by materiality, which shall be true and correct in all respects) on and as of the Restatement Closing Date, and the Agent shall have received a certificate of a Responsible Officer of the Borrower to such effect dated as of the Restatement Closing Date.

4.2 Conditions to Each Revolving Loan. The agreement of each Lender to make each Revolving Loan from time to time requested to be made by it is subject to the satisfaction, immediately prior to or concurrently with the making of such Revolving Loan of the following conditions precedent:

(a) Representations and Warranties; No Default. The following statements shall be true and the Borrower’s acceptance of the proceeds of such Revolving Loan shall be deemed to be a representation and warranty of the Borrower, on the date of such Revolving Loan, that:

(i) The representations and warranties contained in this Agreement, each other Loan Document and each certificate or other writing delivered by the Borrower or any Affiliate of the Borrower to the Agent in connection herewith are correct on and as of such date in all material respects (except for those representations and warranties that are conditioned by materiality, which shall be true and correct in all respects) as though made on and as of such date except (i) to the extent that such representations and warranties expressly relate to an earlier date and (ii) the representations and warranties made under Section 3.1 shall be deemed to refer to the most recent financial statements furnished to the Bank pursuant to Section 5.1 hereof; and

(ii) No Default or Event of Default has occurred and is continuing or would result from the making of the Revolving Loan to be made on such date.

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(b) Legality. The making of such Revolving Loan shall not contravene, in any material respect, any law, rule or regulation applicable to any Lender, the Agent, the Borrower or any other Loan Party.

(c) Borrowing Notice. The Agent shall have received a Borrowing Notice pursuant to the provisions of this Agreement from the Borrower.

SECTION 5. AFFIRMATIVE COVENANTS

The Borrower hereby agrees that from and after the Closing Date, so long as any Obligation (other than contingent indemnity obligations for which no claim has been made) or Revolving Loan Commitment remains outstanding and unpaid or any other amount is due and owing to any Lender or the Agent hereunder or any other Loan Document:

5.1 Financial Statements. The Borrower shall furnish to the Agent:

(a) within one-hundred-twenty (120) days after the end of each fiscal year of the Borrower, (A) a copy of the audited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such year and the related audited income statement, statement of shareholders’ equity and operating cash flow statement for such fiscal year, together with a narrative report describing the operations of the Borrower and its Subsidiaries in the form prepared for presentation to senior management thereof for the applicable fiscal year with respect thereto, and (B) a report thereon without qualification or exception by the Accountants and accompanied by a certificate signed by such Accountants, at the time of the completion of the annual audit, stating that the financial statements fairly present in all material respects the consolidated financial condition of the Borrower as of the date thereof and for the period covered thereby; and

(b) not later than forty-five (45) days after the end of each fiscal quarter of the Borrower, the unaudited consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such quarter and the related unaudited income statement and cash flow statement for such quarter and the portion of the fiscal year through the end of such quarter, in each case in form acceptable to the Agent, and including a comparison of the results of such period with (A) the budgeted results set forth in the budget referred to in Section 5.2(b) and (B) the same period in the prior fiscal year, all certified by a Responsible Officer or other senior officer of the Borrower as being fairly stated in all material respects (subject to normal year-end audit adjustments and the absence of footnotes);

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all such financial statements to be complete and correct in all material respects and to be prepared in reasonable detail and in accordance with GAAP (except for those set forth in clause (b) which shall be in the Borrower’s customary format consistent with prior practice) applied consistently throughout the periods reflected therein and with prior periods.

5.2 Certificates; Other Information. The Borrower shall:

(a) furnish to the Agent, concurrently with the delivery of the financial statements referred to in Section 5.1(a) and (b), a Covenant Compliance Certificate with respect to such fiscal quarter or fiscal year, as the case may be;

(b) furnish to the Agent, as soon as available but in any event within sixty (60) days after the beginning of each fiscal year of the Borrower, a copy of the annual operating budget for the Borrower and its Subsidiaries for such fiscal year (broken down into a monthly format), in form and detail reasonably satisfactory to the Agent;

(c) furnish to the Agent, within five (5) Business Days after the same are filed, copies of all financial statements and material reports and notices which the Borrower or any Subsidiary may make to, or file with, the Securities and Exchange Commission or any successor or analogous Governmental Authority;

(d) furnish to the Agent promptly but, in any event, within five (5) Business Days, after the Borrower’s receipt thereof, copies of all final financial reports (including management letters), if any, submitted to any Loan Party by the Accountants in connection with any annual or interim audit of the books thereof;

(e) furnish to the Agent as soon as possible and in any event within five (5) Business Days after a Responsible Officer has knowledge of the occurrence of a Default, an Event of Default or, in the good faith determination of a Responsible Officer of the Borrower, a Material Adverse Effect, setting forth the details of such Default, Event of Default or Material Adverse Effect and the action which the Borrower proposes to take with respect thereto, if any;

(f) furnish to the Agent (i) as soon as possible and in any event within five (5) Business Days after any Loan Party knows or has reason to know that any Termination Event with respect to any Plan has occurred, a statement of a Responsible Officer of the Borrower describing such Termination Event and the action, if any, which the Borrower proposes to take with respect thereto, (ii) promptly and in any event within five (5) Business Days after receipt thereof by the Borrower, any Subsidiary or any of its or their ERISA Affiliates from the PBGC, copies of each notice received by the Borrower, any Subsidiary or any of its or their ERISA Affiliates of the PBGC’s intention to terminate any Plan or to have a trustee appointed to administer any Plan, (iii) promptly and in any event within five (5) Business Days after the filing thereof with the Internal Revenue Service, copies of each Schedule B (Actuarial Information) to the annual report (Form 5500 Series) with respect to each Single Employer Plan maintained for or covering employees of the Borrower or any of its Subsidiaries if the present value of the accrued benefits under the Plan (determined on the basis of the actuarial assumptions used in the

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minimum funding calculations reflected on such Schedule B) exceeds its assets by an amount which could cause a Material Adverse Effect and (iv) promptly and in any event within five (5) Business Days after receipt thereof by the Borrower, any Subsidiary or any of its or their ERISA Affiliates from a sponsor of a Multiemployer Plan or from the PBGC, a copy of each notice received by the Borrower, any Subsidiary or any of its ERISA Affiliates concerning the imposition or amount of withdrawal liability under Section 4202 of ERISA or indicating that such Multiemployer Plan may enter Reorganization status under Section 4241 of ERISA in each case to the extent such event would reasonably be expected to have a Material Adverse Effect;

(g) furnish to the Agent promptly after the commencement thereof, but in any event not later than five (5) Business Days after service of process with respect thereto on, or the obtaining of knowledge by, the Borrower, notice of each action, suit or proceeding before any court or Governmental Authority or other regulatory body or any arbitrator as to which there is a reasonable possibility of a determination that could reasonably be expected to have a Material Adverse Effect; and

(h) furnish to the Agent promptly such additional financial and other information relating to any Loan Party as the Agent may from time to time reasonably request.

5.3 Payment of Taxes. The Borrower shall, and shall cause each of its Subsidiaries to, cause all assessments and taxes, whether real, personal, or otherwise, due or payable by, or imposed, levied, or assessed against Borrower, its Subsidiaries, or any of their respective assets to be paid in full, before delinquency or before the expiration of any extension period, except to the extent that the validity of such assessment or tax shall be the subject of a Permitted Protest. Borrower will and will cause its Subsidiaries to make timely payment or deposit of all tax payments and withholding taxes required of it and them by applicable laws, including those laws concerning F.I.C.A., F.U.T.A., state disability, and local, state, and federal income taxes, and will, upon request, furnish the Agent with proof satisfactory to the Agent indicating that Borrower and its Subsidiaries have made such payments or deposits.

5.4 Conduct of Business and Maintenance of Existence. The Borrower shall, and shall cause each of its Subsidiaries to, (i) continue to engage in business of the same general type as conducted by the Borrower and its Subsidiaries as of the Closing Date, (ii) preserve, renew and keep in full force and effect its corporate or other legal existence, as applicable and (iii) comply with all Requirements of Law except for such noncompliance that would not reasonably be expected to have a Material Adverse Effect.

5.5 Maintenance of Property; Insurance. (a) The Borrower shall, and shall cause each other Loan Party to, keep (i) the Plant and all equipment necessary or material to the operation of its business located therein and (ii) all other property necessary to its business in good working order and condition (ordinary wear and tear and casualty excepted) except, in the case of property referred to in clause (ii), where the failure to do so would not reasonably be expected to have a Material Adverse Effect.

(b) The Borrower shall, and shall cause each other Loan Party to, maintain with financially sound and reputable insurance companies or associations insurance on such of its property in at least such amounts and against such risks as are usually insured against in the

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same general area by companies similar in size and engaged in the same or a similar business, and furnish to the Agent, upon request, full information as to the insurance carried. All such policies of insurance shall (i) designate the Agent, on behalf of the Lenders, as additional insured or loss payee, as applicable, and (ii) provide that the insurance companies will give the Agent at least thirty (30) days’ prior written notice before any such policy or policies of insurance shall be canceled. The Borrower shall deliver to the Agent insurance certificates certified by the Borrower’s insurance brokers, as to the existence and effectiveness of each policy of insurance and evidence of payment of all premiums then due and payable therefor.

5.6 Inspection of Property; Books and Records; Discussions. The Borrower shall, and shall cause each Subsidiary to, keep proper books of records and account in which full, true and correct entries in conformity with GAAP and all material applicable Requirements of Law shall be made of all material dealings and transactions in relation to its business and activities; and upon reasonable notice and at such reasonable times during usual business hours, permit representatives of the Agent and the Lenders to visit and inspect any of its properties and examine and make abstracts from any of its books and records at any reasonable time and to discuss the business, operations, properties and financial and other condition of the Borrower and its Subsidiaries with officers of the Borrower and its Subsidiaries and with its Accountants.

5.7 Use of Proceeds. The Borrower will use the proceeds of the Revolving Loans as set forth in Section 3.14.

5.8 Plant. On January 19, 2013, and on each 180-day anniversary of such date thereafter until the Plant has received a “certificate of occupancy” or similar governmental certification and is otherwise fully-operational in accordance with the Borrower’s plans as disclosed to the Agent, a listing of the improvements and equipment located at such Plant, such list to be in form and detail reasonably acceptable to the Agent.

5.9 Acquisition of Assets. To the extent the Borrower acquires any assets and is required to grant and perfect a security interest in such assets pursuant to the terms of the Senior Indebtedness, the Borrower will use commercially reasonable efforts to grant and perfect a junior security interest to the Agent in such assets for the benefit of the Secured Parties.

5.10 Environmental Laws. The Borrower shall, and shall cause each Subsidiary to:

(a) comply with, and take reasonable steps to ensure compliance by all tenants and subtenants, if any, with, all applicable Environmental Laws and obtain and comply with any and all licenses, approvals, notifications, registrations or permits required by applicable Environmental Laws except for such noncompliance or failure to obtain as could not reasonably be expected to have a Material Adverse Effect;

(b) conduct and complete all investigations, studies, sampling and testing, and all remedial, removal and other reasonable actions required under applicable Environmental Laws relating to real property owned, leased or occupied by the Borrower or any Subsidiary and timely comply with all orders and directives of all Governmental Authorities regarding such Environmental Laws, except to the extent that the same are being (i) contested in good faith by appropriate proceedings or (ii) could not reasonably be expected to have a Material Adverse Effect; and

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(c) defend, indemnify and hold harmless the Agent, each Lender, and their respective employees, agents, officers and directors, shareholders, successors, attorneys and assigns from and against any and all claims, demands, penalties, fines, liabilities, settlements, damages, costs and expenses of whatever kind or nature known or unknown, contingent or otherwise, arising out of, or in any way relating to (i) the presence of contamination on any of the Properties and any Hazardous Materials migrating from the Properties, (ii) any violation of, noncompliance with or liability under any Environmental Laws applicable to the operations of the Loan Parties, or (iii) any orders, requirements or demands of Governmental Authorities related thereto, including reasonable attorneys’ and consultants’ fees, investigation and laboratory fees, response costs, court costs and litigation expenses. This indemnity shall continue in full force and effect and survive the termination of this Agreement and the payment of the Revolving Loans and all other Obligations.

5.11 Covenants Regarding Subsidiaries. The Borrower will cause each of its Subsidiaries hereafter formed or acquired to execute and deliver to the Agent, within ten (10) days after the formation or acquisition thereof and in each case, so long as the Senior Credit Agreement shall be outstanding, on a subordinate basis to any corresponding subsidiary guarantees, subsidiary security agreements or subsidiary stock pledges held by the Senior Lender in accordance with the terms of the Subordination Agreement, (i) a Subsidiary Guarantee (or, if a Subsidiary Guarantee has already been executed by one or more Subsidiaries, a joinder thereto in form and substance reasonably acceptable to the Agent) and (ii) a Guarantor Security Agreement (or, if a Guarantor Security Agreement has already been executed by one or more Subsidiaries, a joinder thereto in form and substance reasonably acceptable to the Agent), together with appropriate Lien searches requested by the Agent indicating the Agent’s first priority Lien (subject to Section 6.3) on such Subsidiary’s personal property and, in connection with such deliveries, cause to be delivered to the Agent (A) if requested by the Agent, a favorable written opinion of counsel reasonably satisfactory to the Agent as to such matters relating thereto as the Agent may reasonably request, in form and substance reasonably satisfactory to the Agent, (B) stock or membership interest certificates, as applicable, accompanied by transfer powers duly executed in blank, evidencing the Capital Stock of such Subsidiary, (C) such other agreements, instruments, approvals or other documents as the Agent may reasonably request with respect thereto, and (D) certified copies of the organizational documents, resolutions and incumbency certificates of such Subsidiary.

5.12 Canadian Subsidiary. Within thirty (30) days after the written request therefor by the Agent, the Borrower shall (a) cause such Canadian Subsidiary to provide to the Agent a guaranty and security agreement, together with such other security documents (including mortgages with respect to any real property of such new Subsidiary), in each case governed under Ontario law, as well as appropriate financing statements (and with respect to all property subject to a mortgage, fixture filings), all in form and substance satisfactory to the Agent (including being sufficient to grant the Agent a first priority Lien (subject to Section 6.3) in and to the assets of such newly formed or acquired Subsidiary); provided that such guaranty, security agreement, and such other security documents shall not be required to be provided to the Agent with respect to such Canadian Subsidiary if providing such documents would result in material

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adverse tax consequences, and (b) provide to the Agent all other documentation, including one or more opinions of counsel satisfactory to the Agent, which in its opinion is appropriate with respect to the execution and delivery of the applicable documentation referred to above (including policies of title insurance or other documentation with respect to all property subject to a mortgage); provided that only 65% of the total outstanding voting Capital Stock of the Canadian Subsidiary (and none of any Subsidiary of such Canadian Subsidiary) shall be required to be pledged if pledging a greater amount would result in material adverse tax consequences (which pledge, if reasonably requested by the Agent, shall be governed under Ontario law). Any document, agreement, or instrument executed or issued pursuant to this Section 5.12 shall be a Loan Document.

SECTION 6. NEGATIVE COVENANTS

The Borrower hereby agrees that from and after the Closing Date, so long as any Obligation (other than contingent indemnity obligations for which no claims has been made) or Commitment remains outstanding and unpaid or any other amount is due and owing to any Lender or the Agent hereunder or any other Loan Document:

6.1 Financial Condition Covenant. The Borrower shall not:

(a) Maximum Debt Covenant. Permit, as of the last day of any fiscal quarter, beginning with the quarter ending March 31, 2013, the ratio of (i) Total Debt (including all loans and other credit extensions outstanding under the Senior Credit Agreement, but excluding any debt to Shareholder Guarantors) to (ii) Trailing Twelve-Month Revenue for the four consecutive fiscal quarter period ending on such date (the “Maximum Debt Covenant”) to be greater than the following with respect to the fiscal quarter set forth opposite each such ratio below (including such periods which may exist if the Maturity Date is extended pursuant to the terms of the definition thereof):

Quarter	Ratio
March 31, 2013 through and including December 31, 2013		1.75:1.00
March 31, 2014 through and including December 31, 2014		1.50:1.00
March 31, 2015 through and including June 30, 2016		1.25:1.00
September 30, 2016 and thereafter		1.00:1.00

6.2 Limitation on Indebtedness. Create, incur, assume, suffer to exist, guarantee, or otherwise become or remain, directly or indirectly, liable with respect to any Indebtedness, except for:

(a) Indebtedness evidenced by this Agreement and the other Loan Documents;

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(b) Senior Indebtedness;

(c) Hedging Obligations

(d) Permitted Purchase Money Indebtedness;

(e) refinancings, renewals, or extensions of Indebtedness permitted under clauses (b) and (c) above (and continuance or renewal of any Lien permitted under Section 6.3 associated therewith) so long as: (i) the terms and conditions of such refinancings, renewals, or extensions do not, in the Agent’s reasonable judgment, materially impair the prospects of repayment of the Obligations by Borrower or materially impair Borrower’s creditworthiness, (ii) such refinancings, renewals, or extensions do not result in an increase in the principal amount of, or interest rate with respect to, the Indebtedness so refinanced, renewed, or extended, (iii) such refinancings, renewals, or extensions do not result in a shortening of the average weighted maturity of the Indebtedness so refinanced, renewed, or extended, nor are they on terms or conditions that, taken as a whole, are materially more burdensome or restrictive to Borrower, (iv) if the Indebtedness that is refinanced, renewed, or extended was subordinated in right of payment to the Obligations, then the terms and conditions of the refinancing, renewal, or extension Indebtedness must include subordination terms and conditions that are at least as favorable to the Lenders as those that were applicable to the refinanced, renewed, or extended Indebtedness, and (v) the Indebtedness that is refinanced, renewed, or extended is not recourse to any Person that is liable on account of the Obligations other than those Persons which were obligated with respect to the Indebtedness that was refinanced, renewed, or extended;

(f) endorsement of instruments or other payment items for deposit;

(g) Subordinated Debt; and

(h) other unsecured Indebtedness in an aggregate amount not to exceed $7,000,000 at any time outstanding.

6.3 Limitation on Liens. The Borrower shall not, and shall not permit any Subsidiary to, create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired, except for:

(a) Liens created hereunder or under any of the other Loan Documents;

(b) Liens for taxes, assessments, fees and other charges of any Governmental Authority that are not yet delinquent or which are being contested in good faith by appropriate proceedings, provided that adequate reserves with respect thereto are maintained on the books of the Borrower or a Subsidiary, as applicable, in conformity with GAAP;

(c) Liens created by operation of law not securing the payment of Indebtedness for money borrowed or guaranteed, including carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, landlords’, shippers’, laborers’ or other like Liens arising in the ordinary course of business which are not overdue for a period of more than forty-five (45) days and, if overdue, for which adequate reserves have been posted under GAAP;

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(d) pledges or deposits in connection with payroll taxes, workers’ compensation, unemployment insurance and other social security legislation;

(e) pledges or deposits to secure the performance of bids, trade contracts (other than for borrowed money), leases, statutory or regulatory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

(f) easements, rights-of-way, restrictions and other similar encumbrances on real property incurred in the ordinary course of business which in the aggregate could not cause a Material Adverse Effect;

(g) Liens securing Capitalized Lease Obligations; provided that no such Lien covers any property other than the property subject to such Capitalized Lease Obligation, or acquired in connection with the incurrence of such Indebtedness, as applicable, and the proceeds thereof;

(h) precautionary Liens filed by equipment lessors pursuant to operating leases of the Borrower and the Subsidiaries; provided that no such Lien covers any property other than the property subject to such lease;

(i) Liens arising from any interest of a lessor under any real property lease or sublease agreement entered into by the Borrower or any Subsidiary in the ordinary course of business;

(j) subject to the Subordination Agreement, Liens securing the Senior Indebtedness (provided that in no event shall the Senior Indebtedness be secured by the property encumbered by the Plant Mortgage); and

(k) Liens securing Indebtedness permitted by Section 6.2 and not referred to in any other provision of this Section 6.3, so long as such Liens (i) are for Subordinated Debt and (ii) do not encumber the property subject to the Plant Mortgage.

6.4 Limitation on Fundamental Changes. The Borrower shall not, and shall not permit any Subsidiary to, (i) make any amendment to its Organic Documents in a manner materially adverse to the Lenders, or (ii) except for the dissolution or liquidation of any Canadian Subsidiary existing on the Closing Date, enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution) except any merger, consolidation or amalgamation of a Subsidiary that is a Loan Party into the Borrower, with the Borrower being the survivor thereof, or between or among the Subsidiaries; provided that the Borrower shall give the Agent twenty (20) days’ prior written notice thereof and shall comply with all reasonable actions requested by the Agent to protect and maintain its Liens granted pursuant to the Loan Documents; or (iii) convey, sell, lease, assign, transfer or otherwise dispose of, all or substantially all of its property, business or assets.

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6.5 Limitation on Sale of Assets.

(a) The Borrower shall not, and shall not permit any of its Subsidiaries to, make any Asset Disposition unless (i) such Asset Disposition is for fair market value, (ii) no Event of Default has occurred and is continuing or would result from such Asset Disposition and (iii) the consideration for such Asset Disposition is at least 75% cash; provided that with respect to any Asset Disposition involving all or a portion of the property subject to the Plant Mortgage and resulting in net cash proceeds in excess of $1,000,000 per fiscal year (such proceeds not exceeding $1,000,000, the “Retained Asset Disposition Proceeds”), unless otherwise agreed to in writing by the Agent in its sole discretion, the proceeds of such disposition (net of reasonable closing costs) not constituting Retained Asset Disposition Proceeds shall be applied by the Borrower, within ten (10) Business Days following such disposition, to prepay Revolving Loans in the amount of such net proceeds and to permanently reduce the aggregate Revolving Loan Commitments by a corresponding amount.

(b) With respect to Retained Asset Disposition Proceeds, the Borrower shall prepay the outstanding principal amount of the Revolving Loans (without any permanent reduction of the respective Revolving Commitment Percentages) in an amount equal to the Retained Asset Disposition Proceeds; provided that, so long as the Borrower or its Subsidiaries, as applicable, complete such replacement, purchase, or construction within one-hundred-eighty (180) days after the initial receipt of such monies, the Borrower and its Subsidiaries shall have the option to apply such monies to the costs of replacement of the property or assets that are the subject of such sale or disposition unless and to the extent that such applicable period shall have expired without such replacement, purchase or construction being made or completed, in which case, such monies shall promptly be paid to the Agent and applied to prepay Revolving Loans in the amount of such net proceeds (without any permanent reduction of the respective Revolving Commitment Percentages).

6.6 Limitation on Restricted Payments. The Borrower shall not, and shall not permit any of its Subsidiaries to, directly or indirectly, redeem, repurchase, retire or otherwise make any payments (such payments, purchases, redemptions, retirements, being herein called a “Restricted Payment”) with respect to the Class B Preferred Stock and Class C Preferred Stock of the Borrower unless, as of the date of the proposed making of such Restricted Payment, (a) both before and after giving effect to such Restricted Payment, no Default or Event of Default has occurred or would occur as a result thereof and (b) Liquidity is at least $10,000,000 and (c) the Borrower has delivered to the Agent a certificate, in form and detail satisfactory to the Agent, demonstrating the foregoing.

6.7 [Intentionally Omitted].

6.8 Transactions with Affiliates. The Borrower shall not directly or indirectly enter into or permit to exist any transaction with any Affiliate of Borrower except for (a) transactions that (i) are in the ordinary course of Borrower’s business, (ii) are upon fair and reasonable terms, and (iii) are no less favorable to Borrower or its Subsidiaries, as applicable, than would be obtained in an arm’s length transaction with a non-Affiliate or (b) transactions involving the payment of fees (and entering into related agreements with respect thereto) to shareholders of the Borrower in connection with the guarantee of any Indebtedness of the Borrower by such shareholder so long as such fees have been approved by the board of directors of the Borrower.

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6.9 Fiscal Year. The Borrower shall not permit the fiscal year of the Borrower or any Subsidiary to end on a day other than December 31.

6.10 Prohibitions on Certain Agreements. The Borrower shall not, nor shall it permit any Subsidiary to, enter into or permit to exist any indenture, agreement, instrument or other arrangement, other than the Loan Documents and the Senior Debt Documents (subject to the Subordination Agreement), that, directly or indirectly, prohibits or restrains, or has the effect of prohibiting or restraining, or imposes materially adverse conditions upon, the payment of this Indebtedness.

6.11 Line of Business. Neither the Borrower nor any of its Subsidiaries shall engage to any material extent in any business other than businesses of the type conducted by the Borrower and the Restricted Subsidiaries on the Closing Date and businesses reasonably related or ancillary thereto.

6.12 Anti-Terrorism Laws. The Borrower shall not, nor shall it permit any of its Subsidiaries to, directly or indirectly (a) knowingly enter into any Contractual Obligation with any Person listed on the OFAC Lists; (b) knowingly conduct any business or engage in any transaction or dealing with any Blocked Person, including the making or receiving of any contribution of funds, goods or services to or for the benefit of any Blocked Person; (c) knowingly deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to Executive Order No. 13224, any similar executive order or other Anti-Terrorism Law; or (d) knowingly engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the prohibitions set forth in Executive Order No. 13224 or other Anti-Terrorism Law.

SECTION 7. EVENTS OF DEFAULT

7.1 Events of Default.

If any of the following events shall occur and be continuing:

(a) The Borrower shall fail to pay, (i) any principal of any Revolving Loan, (ii) any interest on any Revolving Loan or (iii) any other amount payable hereunder or under any Loan Document, in each case (x) within three (3) Business Days after the date when such amount becomes due, or (y) if such failure to pay is caused by a reduction in the Maximum Revolving Amount as a result of a Guarantor Default, within the Guarantor Cure Period contemplated by Section 7.2(a); or

(b) Any representation or warranty made by any Loan Party herein or in any other Loan Document, as applicable, or which is contained in any certificate, document or financial or other statement furnished at any time under or in connection with this Agreement or any other Loan Document shall prove to have been incorrect in any material respect when made or deemed made; or

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(c) The Borrower shall default in the observance or performance of any agreement contained in Section 5.2(e) or any provision of Section 6; or

(d) Any Loan Party shall default in the observance or performance of any other agreement contained in this Agreement or the other Loan Documents (other than as provided in paragraphs (a) through (c) of this Section), and such default shall continue unremedied for a period of thirty (30) days after notice thereof from the Agent to the Borrower; or

(e) Any provision of any Loan Document shall at any time for any reason be declared null and void, or the validity or enforceability of any Loan Document shall at any time be contested by any Loan Party or any other party thereto (other than the Agent) in writing, or a proceeding shall be commenced by any Loan Party or such other party, or by any Governmental Authority or other Person having jurisdiction over any Loan Party or such other party, seeking to establish the invalidity or unenforceability thereof, or any Loan Party or any such other party shall deny in writing that it has any liability or obligation purported to be created under any Loan Document or any Loan Document shall cease to be in full force and effect; or

(f) The failure by the Borrower or any Subsidiary to pay any Indebtedness for borrowed money within any applicable grace period after final maturity or the acceleration of any such Indebtedness by the holders thereof because of a default, either under the Senior Indebtedness or under Indebtedness having an aggregate principal amount in excess of $5,000,000; or

(g) (i) The Borrower or any other Loan Party shall commence any voluntary case, proceeding or other action (A) under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an order for relief entered with respect to it, or seeking to adjudicate it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, winding-up, liquidation, dissolution, composition or other relief with respect to it or its debts, or (B) seeking appointment of a receiver, trustee, custodian or other similar official for it or for all or any substantial part of its assets, or the Borrower or any other Loan Party shall make a general assignment for the benefit of its creditors; or (ii) there shall be commenced against the Borrower or any other Loan Party any involuntary case, proceeding or other action of a nature referred to in clause (i) above which (A) results in the entry of an order for relief or any such adjudication or appointment and (B) remains undismissed, undischarged, unstayed or unbonded for a period of sixty (60) days; or (iii) there shall be commenced against the Borrower or any other Loan Party any case, proceeding or other action seeking issuance of a warrant of attachment, execution, distraint or similar process against all or any substantial part of its assets which results in the entry of an order for any such relief which shall not have been vacated, discharged, stayed or bonded pending appeal within sixty (60) days from the entry thereof; or (iv) the Borrower or any other Loan Party shall take any action in writing in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii) above; or (v) the Borrower or any other Loan Party shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they become due or there shall be a general assignment for the benefit of creditors; or

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(h) (i) Any Person shall engage in any non-exempt “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (ii) any “accumulated funding deficiency” (as defined in Section 302 of ERISA), whether or not waived, shall exist with respect to any Plan, (iii) a Reportable Event shall occur with respect to, or proceedings shall commence to have a trustee appointed, or a trustee shall be appointed, to administer or to terminate any Single Employer Plan, which Reportable Event or commencement of proceedings or appointment of a trustee would reasonably be expected to result in the termination of such Plan for purposes of Title IV of ERISA, (iv) any Single Employer Plan shall terminate for purposes of Title IV of ERISA (other than a standard termination within the meaning of Section 4041(b) of ERISA) or (v) the Borrower or any ERISA Affiliate thereof would reasonably be expected to incur any liability in connection with a withdrawal from, or the Insolvency or Reorganization of, a Multiemployer Plan; or

(i) One or more judgments or decrees shall be entered against one or more of the Loan Parties involving in the aggregate a liability (to the extent not paid or fully covered by insurance under which the insurer has acknowledged liability in writing) for all Loan Parties of $2,000,000 or more, and all such judgments or decrees shall not have been vacated, discharged, stayed or bonded pending appeal within sixty (60) days from the entry thereof or in any event five (5) days before the date of any sale pursuant to such judgment or decree; or any non-monetary judgment or order shall be entered against any Loan Party that could reasonably be expected to have a Material Adverse Effect and either (i) enforcement proceedings shall have been commenced by any Person upon such judgment which has not been stayed pending appeal or (ii) there shall be any period of thirty (30) consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect purchased; or

(j) A Change of Control shall occur; or

(k) Any Lien created under any Loan Document shall for any reason other than pursuant to the terms thereof, cease to be a valid and perfected first priority (except as permitted by Section 6.3) Lien in any material portion of the Collateral, the Guarantor Collateral or the property purported to be covered thereby; or

(l) An “Event of Default” shall occur and be in continuance under the Senior Debt Documents and the Senior Lender shall have accelerated any of the obligations thereunder; or

(m) An “Event of Default” shall occur under the Mid-Ocean Equity Contribution Agreement or an “Event of Default” shall occur under the Fresh Pet Guarantee and, in either case, such “Event of Default” shall not have been cured pursuant to Section 7.2 within the Guarantor Cure Period;

then, and in any such event, (A) if such event is an Event of Default specified in paragraph (g) above, automatically each Commitment shall immediately terminate and the Revolving Loans made to the Borrower hereunder (with accrued interest thereon) and all other Obligations shall immediately become due and payable and (B) if such event is any other Event of Default, with the consent of the Majority Lenders the Agent may, or upon the request of the Majority Lenders

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the Agent shall, take any or all of the following actions: (i) by written notice to the Borrower declare the Commitments to be terminated forthwith, whereupon the Commitments shall immediately terminate; and (ii) by written notice to the Borrower, declare the Revolving Loans (with accrued interest thereon) and all other Obligations under this Agreement to be due and payable forthwith, whereupon the same shall immediately become due and payable. For purposes of clauses (A) and (B) of this paragraph of this Section 7, “Loan Documents” shall not include any Lender Hedging Agreement and “Obligations” shall not include obligations pursuant to any Lender Hedging Agreement. In all cases, with the consent of the Majority Lenders, the Agent may enforce any or all of the Liens and other rights and remedies created pursuant to any Loan Document or available at law or in equity. Presentment, demand, protest and all other notices of any kind are hereby expressly waived by the Borrower.

7.2 Cure of Guarantor Default. If a Default shall have occurred under Section 7.1(a)(y) or 7.1(m) above, then, in each case, the Borrower shall have ten (10) Business Days (the “Guarantor Cure Period”) following the occurrence of such Default to cause one of the following to occur:

(a) Cause one or more existing Compliant Guarantors to increase its respected Covered Amount in an aggregate amount equal to the Covered Amount of the Non-Compliant Guarantor. Such increases shall be (i) from a Compliant Guarantor acceptable to the Agent, (ii) evidenced by amendments to the Guarantee or Equity Contribution Agreement, as applicable, of such Compliant Guarantor, in form and substance satisfactory to the Agent and (iii) accompanied by such financial statements and other financial information evidencing the financial condition of such Guarantor as the Agent shall request, including evidence of additional “Liquidity” or “Uncalled Capital Commitments”, as applicable, of such Guarantor corresponding to such increased Covered Amount.

(b) Cause one or more Persons acceptable to the Agent to become new Guarantors hereunder having a Covered Amount equal to the Covered Amount of the Non-Compliant Guarantor. Such new Guarantor shall execute in favor of the Agent a Shareholder Guarantee or an Equity Contribution Agreement, as applicable, substantially in the form of the Shareholder Guarantees and Equity Contribution Agreement in existence on the Restatement Closing Date. Such new Guarantee shall be accompanied by (i) such financial statements and other financial information evidencing the financial condition of such Guarantor as the Agent shall request, including evidence of “Liquidity” or “Uncalled Capital Commitments”, as applicable, of such Guarantor corresponding to its Covered Amount, (ii) certified copies of its formation documents, resolutions and an incumbency certificate, (iii) an opinion of counsel to such new Guarantor in form, and from a firm, satisfactory to the Agent and (iv) such other information regarding such new Guarantor as the Agent shall request; or

(c) Such Guarantor Default shall be otherwise cured or waived in writing to the satisfaction of the Agent.

Notwithstanding the foregoing, during the Guarantor Cure Period an Event of Default shall be deemed to have occurred and be continuing under this Agreement for all purposes (including application of the default rate of interest under Section 2.6(b)) other than with respect to the right of the Agent and the Lenders to cause acceleration as contemplated by the last paragraph of Section 7.1, or exercise remedies under the Loan Documents.

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7.3 Application of Payments and Proceeds. Upon the occurrence and during the continuance of an Event of Default and after the acceleration of the principal amount of any of the Revolving Loans, all payments and proceeds in respect of any of the Obligations received by the Agent or any Secured Party under any Loan Document, including any proceeds of any sale of, or other realization upon, all or any part of the Collateral or the Guarantor Collateral, shall be applied as follows:

first, to all fees, costs, indemnities, liabilities, obligations and expenses incurred by or owing to the Agent with respect to this Agreement, the other Loan Documents or the Collateral or the Guarantor Collateral;

second, to all fees, costs, indemnities, liabilities, obligations and expenses incurred by or owing to any other Secured Party with respect to this Agreement, the other Loan Documents or the Collateral or the Guarantor Collateral;

third, to accrued and unpaid interest on the Obligations (including any interest which, but for the provisions of the Bankruptcy Code, would have accrued on such amounts);

fourth, to the principal amount of the Obligations and to the Obligations owing to any counterparty in respect of any Lender Hedging Agreement;

fifth, to any other Obligations owing to the Agent or any other Secured Party under the Loan Documents; and

sixth, to the Borrower or to whoever may be lawfully entitled to receive such balance or as a court of competent jurisdiction may direct.

In carrying out the foregoing, (a) amounts received shall be applied in the numerical order provided until exhausted prior to the application to the next succeeding category, and (b) each of the Persons entitled to receive a payment in any particular category shall receive an amount equal to its pro rata share of amounts available to be applied pursuant thereto for such category.

SECTION 8. THE AGENT

8.1 Appointment. Each Lender hereby irrevocably designates and appoints OneWest Bank, as Agent for such Lender under this Agreement and the other Loan Documents, and each such Lender irrevocably authorizes OneWest Bank, as the Agent for such Lender, to take such action on its behalf under the provisions of this Agreement and the other Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Agent, by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement, the Agent shall not have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against the Agent in such capacity.

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8.2 Delegation of Duties. The Agent may execute any of its duties under this Agreement and the other Loan Documents by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

8.3 Exculpatory Provisions. Neither the Agent nor any of its officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or Affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with this Agreement or any other Loan Document (except for its or such Person’s own gross negligence or willful misconduct) or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower, any other Loan Party, or any other party to the Loan Documents, or any officer thereof, contained in this Agreement or any other Loan Document or in any certificate, report, statement or other document referred to or provided for in, or received by the Agent under or in connection with, this Agreement or any other Loan Document or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other Loan Document or for any failure of the Borrower, any other Loan Party, or any other party to the Loan Documents to perform its obligations hereunder or thereunder. The Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this Agreement or any other Loan Document, or to inspect the properties, books or records of the Borrower, any other Loan Party, or any other party to the Loan Documents.

8.4 Reliance by Agent. The Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice (including any telephonic notice), consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation reasonably believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Borrower), the Accountants and independent accountants and other experts selected by the Agent. The Agent may deem and treat the payee of any Note as the owner thereof for all purposes unless a written notice of assignment, negotiation or transfer thereof shall have been filed with the Agent. The Agent shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless it shall first receive such advice or concurrence of the Majority Lenders or all Lenders, as it deems appropriate, or it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense (except those incurred solely as a result of the Agent’s gross negligence or willful misconduct) which may be incurred by it by reason of taking or continuing to take any such action. The Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with a request of the Majority Lenders or all Lenders, as may be required, and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Revolving Loans.

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8.5 Notice of Default. Neither the Agent nor any Lender shall be deemed to have knowledge or notice of the occurrence of any Default hereunder unless such Person has received notice from the Agent, a Lender or the Borrower referring to this Agreement, describing such Default and stating that such notice is a “notice of default”. In the event that the Agent or any Lender receives such a notice, the Agent or such Lender, as the case may be, shall give notice thereof to the Agent and the Lenders. The Agent shall take such action with respect to such Default as shall be reasonably directed by the Majority Lenders or all Lenders as appropriate; provided that unless and until the Agent shall have received such directions, the Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default as it shall deem advisable in the best interests of the Lenders or as the Agent shall believe necessary to protect the Agent and the Lenders’ interests in the Collateral or the Guarantor Collateral.

8.6 Non-Reliance on Agent and Other Lenders. Each Lender expressly acknowledges that none of the Agent or any of its respective officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or Affiliates has made any representations or warranties to it and that no act by the Agent hereafter taken, including any review of the affairs of the Borrower, any other Loan Party, or any other party to the Loan Documents, shall be deemed to constitute any representation or warranty by the Agent to any Lender. Each Lender represents to the Agent that it has, independently and without reliance upon the Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of the Borrower, the other Loan Parties, and any other party to the Loan Documents and made its own decision to make its Revolving Loans and enter into this Agreement. Each Lender also represents that it will, independently and without reliance upon the Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Borrower, the other Loan Parties, and any other party to the Loan Documents. The Agent agrees to promptly furnish to each Lender a copy of all notices, reports and other documents received by it from the Borrower pursuant to the terms hereof; provided that the Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of the Borrower, any other Loan Party, or any other party to the Loan Documents which may otherwise come into the possession of the Agent or any of its officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or Affiliates except such as may come into the possession of the employees of Agent then having the responsibility for the administration of this Agreement.

8.7 Indemnification. The Lenders hereby indemnify the Agent in its capacity as such (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably according to the respective amounts of their Aggregate Total Commitment Percentages, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs (including, without limitation, the allocated cost of internal counsel), expenses or disbursements of any kind whatsoever which may at any time (including, without limitation, at any time following the payment of the Obligations) be imposed

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on, incurred by or asserted against the Agent in any way relating to or arising out of this Agreement, any of the other Loan Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by the Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements to the extent resulting from the Agent’s gross negligence or willful misconduct. The agreements in this Section shall survive the termination of this Agreement and the payment of the Revolving Loans and all other Obligations.

8.8 Agent in Its Individual Capacity. The Agent and its Affiliates may make loans to, accept deposits from and generally engage in any kind of business with the Borrower, the other Loan Parties and any other party to the Loan Documents as though the Agent were not the Agent hereunder and under the other Loan Documents. With respect to the Agent, the Revolving Loans made by the Agent and the Notes issued to the Agent shall have the same rights and powers under this Agreement and the other Loan Documents as any Lender and the Agent may exercise the same as though it were not the Agent and the terms “Lender” and “Lenders” shall include the Agent in its individual capacity.

8.9 Successor Agent. The Agent may resign as Agent upon thirty (30) days’ notice to the Lenders and the Borrower. If the Agent shall resign as Agent under this Agreement and the other Loan Documents, then the Majority Lenders shall appoint (with the approval of the Borrower) from among the Lenders a successor agent for the Lenders, whereupon such successor agent shall succeed to the rights, powers and duties of the Agent and the term “Agent” shall mean such successor agent, effective upon its appointment, and the former Agent’s rights, powers and duties as Agent shall be terminated, without any other or further act or deed on the part of such former Agent or any of the parties to this Agreement or any holders of any of the Obligations. Notice of such appointment shall be given by such successor agent to the Borrower and each Lender. Whether or not a successor has been appointed, such resignation shall nonetheless become effective in accordance with such notice on such thirtieth day. After any retiring Agent’s resignation as Agent, the provisions of this Section shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Agent, under this Agreement and the other Loan Documents.

8.10 Administrative Agent May File Proofs of Claim. In case of the pendency of any proceeding under the Bankruptcy Code or any similar debtor relief law or any other judicial proceeding relative to any Loan Party, the Agent (irrespective of whether the principal of any Revolving Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Agent shall have made any demand on the Borrower) shall be entitled and empowered (but not obligated) by intervention in such proceeding or otherwise:

(a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Revolving Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Agent and their respective agents and counsel) allowed in such judicial proceeding; and

(b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

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and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Agent.

8.11 Collateral Matters.

(a) The Lenders hereby authorize the Agent, at its option and in its discretion, to release any Lien granted to or held by the Agent upon any Collateral or Guarantor Collateral (i) upon termination of the Commitments and payment and satisfaction of all of the Obligations (other than contingent indemnification obligations that are not then due and payable) at any time arising under or in respect of this Agreement or the Loan Documents or the transactions contemplated hereby or thereby, (ii) constituting property being sold or otherwise disposed of upon the sale or other disposition thereof in compliance with Section 6.5, (iii) if approved, authorized or ratified in writing by the Majority Lenders or all Lenders, as applicable. Upon request by the Agent at any time, the Lenders will confirm in writing the Agent’s authority to release particular types or items of Collateral or Guarantor Collateral pursuant to this Section. The Lenders hereby authorize the Agent, at its option and in its discretion to release any Subsidiary Guarantor from its obligations under its Guarantee if such Person ceases to be a Subsidiary as a result of a transaction permitted hereunder.

(b) No Secured Party shall have any right individually to realize upon any of the Collateral or the Guarantor Collateral or to enforce any Guarantee. The Lenders understand and agree that all powers, rights and remedies hereunder and under any of the Loan Documents (other than the Lender Hedging Agreements) may be exercised solely by the Agent for the benefit of the Secured Parties in accordance with the terms hereof and thereof.

(c) The Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral or the Guarantor Collateral, the existence, priority or perfection of any Lien thereon, or any certificate prepared by any Loan Party in connection therewith, and the Agent shall not be responsible or liable to the Lenders or any other Secured Party for any failure to monitor or maintain any portion of the Collateral or the Guarantor Collateral.

SECTION 9. SECURITY

9.1 Grant of Security Interest. The Borrower hereby grants to the Agent, for the benefit of the Secured Parties, a continuing security interest in all of its right, title, and interest in all currently existing and hereafter acquired or arising Borrower Collateral in order to secure prompt repayment of any and all of the Obligations in accordance with the terms and conditions of the Loan Documents and in order to secure prompt performance by the Borrower of each of its covenants and duties under the Loan Documents. The Agent’s Liens in and to the Borrower Collateral shall attach to all Borrower Collateral without further act on the part of the Agent or the Borrower. Anything contained in this Agreement or any other Loan Document to the contrary notwithstanding, except for Asset Dispositions permitted pursuant to Section 6.5 hereof, the Borrower and its Subsidiaries have no authority, express or implied, to dispose of any item or portion of the Collateral.

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9.2 Negotiable Collateral. In the event that any Borrower Collateral, including proceeds, is evidenced by or consists of Negotiable Collateral, and if and to the extent that the Agent determines that perfection or priority of the Agent’s security interest is dependent on or enhanced by possession, the Borrower, promptly upon the request of the Agent and subject to the terms of the Subordination Agreement, shall endorse and deliver physical possession of such Negotiable Collateral to the Agent.

9.3 Collection of Accounts, General Intangibles and Negotiable Collateral. At any time after the occurrence and during the continuation of an Event of Default, the Agent or the Agent’s designee may, subject to the terms of the Subordination Agreement, (a) notify Account Debtors of the Borrower that the Borrower’s Accounts, chattel paper, or General Intangibles have been assigned to the Agent or that the Agent has a security interest therein, or (b) collect the Borrower’s Accounts, chattel paper, or General Intangibles directly and charge the collection costs and expenses to the Borrower. The Borrower agrees that it will hold in trust for the Agent, as the Agent’s trustee, any of its or its Subsidiaries’ Collections that it receives and immediately will deliver such Collections, subject to the terms of the Subordination Agreement, to the Agent or a cash management bank reasonably acceptable to the Agent in their original form as received by the Borrower or its Subsidiaries.

9.4 Filing of Financing Statements; Commercial Tort Claims; Delivery of Additional Documentation Required.

(a) The Borrower authorizes the Agent to file any financing statement necessary or desirable to effectuate the transactions contemplated by the Loan Documents, and any continuation statement or amendment with respect thereto, in any appropriate filing office without the signature of the Borrower where permitted by applicable law. The Borrower hereby ratifies the filing of any financing statement filed without the signature of the Borrower prior to the date hereof.

(b) If the Borrower or its Subsidiaries acquire any commercial tort claims with a value in excess of $250,000 after the date hereof, the Borrower shall promptly (but in any event within three (3) Business Days after such acquisition) deliver to the Agent a written description of such commercial tort claim and shall deliver a written agreement, in form and substance reasonably satisfactory to the Agent, pursuant to which the Borrower or its Subsidiary, as applicable, shall grant a perfected security interest in all of its right, title and interest in and to such commercial tort claim to the Agent, subject to the terms of the Subordination Agreement, as security for the Obligations (a “Commercial Tort Claim Assignment”).

(c) At any time upon the request of the Agent, the Borrower shall, subject to the terms of the Subordination Agreement, execute or deliver to the Agent, and shall cause its Subsidiaries to execute or deliver to the Agent, any and all financing statements, original financing statements in lieu of continuation statements, amendments to financing statements, fixture filings, security agreements, pledges, assignments, Commercial Tort Claim Assignments, endorsements of certificates of title, and all other documents (collectively, the “Additional

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Documents”) that the Agent may request in its discretion, in form and substance reasonably satisfactory to the Agent, to create, perfect, and continue perfected or to better perfect the Agent’s Liens in the assets of the Borrower and its Subsidiaries (whether now owned or hereafter arising or acquired, tangible or intangible, real or personal), to create and perfect Liens in favor of the Agent in any owned real property acquired after the Closing Date, and in order to fully consummate all of the transactions contemplated hereby and under the other Loan Documents. To the maximum extent permitted by applicable law, the Borrower authorizes the Agent to execute any such Additional Documents in the Borrower’s name and authorizes the Agent to file such executed Additional Documents in any appropriate filing office. In addition, on such periodic basis as the Agent shall require, the Borrower shall (i) provide the Agent with a report of all new material patentable, copyrightable, or trademarkable materials acquired or generated by the Borrower or its Subsidiaries during the prior period, (ii) cause all material patents, copyrights, and trademarks acquired or generated by the Borrower or its Subsidiaries that are not already the subject of a registration with the appropriate filing office (or an application therefor diligently prosecuted) to be registered with such appropriate filing office in a manner sufficient to impart constructive notice of the Borrower’s or the applicable Subsidiary’s ownership thereof, and (iii) cause to be prepared, executed, and delivered to the Agent supplemental schedules to the applicable Loan Documents to identify such patents, copyrights, and trademarks as being subject to the security interests created thereunder ; provided, however, that neither the Borrower nor any of its Subsidiaries shall register with the U.S. Copyright Office any unregistered copyrights (whether in existence on the Closing Date or thereafter acquired, arising, or developed) unless (i) the Borrower provides the Agent with written notice of its intent to register such copyrights not less than thirty (30) days prior to the date of the proposed registration, and (ii) prior to such registration, the applicable Person executes and delivers to the Agent a Copyright Security Agreement, supplemental schedules to any existing Copyright Security Agreement, or such other documentation as the Agent reasonably deems necessary in order to perfect and continue perfected the Agent’s Liens on such copyrights following such registration.

9.5 Power of Attorney. The Borrower hereby irrevocably makes, constitutes, and appoints the Agent (and any of the Agent’s officers, employees, or agents designated by the Agent) as the Borrower’s true and lawful attorney, with power, subject to the terms of the Subordination Agreement, to (a) if the Borrower refuses to, or fails timely to execute and deliver any of the documents described in Section 9.4, sign the name of the Borrower on any of the documents described in Section 9.4, (b) at any time that an Event of Default has occurred and is continuing, sign the Borrower’s name on any invoice or bill of lading relating to the Borrower Collateral, drafts against Account Debtors, or notices to Account Debtors, (c) send requests for verification of the Borrower’s or its Subsidiaries’ Accounts, (d) endorse the Borrower’s name on any of its payment items (including all of its Collections) that may come into the Agent’s possession, (e) at any time that an Event of Default has occurred and is continuing, make, settle, and adjust all claims under the Borrower’s policies of insurance and make all determinations and decisions with respect to such policies of insurance, and (f) at any time that an Event of Default has occurred and is continuing, settle and adjust disputes and claims respecting the Borrower’s or its Subsidiaries’ Accounts, chattel paper, or General Intangibles directly with Account Debtors, for amounts and upon terms that the Agent determines to be reasonable, and the Agent may cause to be executed and delivered any documents and releases that the Agent determines to be necessary. The appointment of the Agent as the Borrower’s attorney, and each and every one of its rights and powers, being coupled with an interest, is irrevocable until all of the Obligations have been fully and finally repaid and performed and the Agent’s obligations to extend credit hereunder are terminated.

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9.6 Right to Inspect. The Agent (through any of its officers, employees, or agents) shall have the right, from time to time hereafter to inspect the Books and make copies or abstracts thereof and to check, test, and appraise the Collateral, or any portion thereof, in order to verify the Borrower’s and its Subsidiaries’ financial condition or the amount, quality, value, condition of, or any other matter relating to, the Collateral.

SECTION 10. MISCELLANEOUS

10.1 Amendments and Waivers. Neither this Agreement or any other Loan Document, nor any terms hereof or thereof may be amended, supplemented or modified except in accordance with the provisions of this Section. With the prior written consent of the Majority Lenders and the Borrower, the Borrower may, from time to time, enter into written amendments, supplements or modifications hereto and to the other Loan Documents for the purposes of adding any provisions to this Agreement or the other Loan Documents or changing in any manner the rights of the Lenders, the Borrower or any other Loan Party hereunder or thereunder or waiving, on such terms and conditions as may be specified in such instrument, any of the requirements of this Agreement or the other Loan Documents or any Default and its consequences; provided, however, that no such waiver and no such amendment, supplement or modification shall: (a) reduce the amount or extend the maturity of any Revolving Loan or any installment due thereon, or reduce the rate or extend the time of payment of interest thereon, or reduce the amount or extend the time of payment of any fee, indemnity or reimbursement payable to any Lender hereunder, or increase any Commitment, in each case without the written consent of the Lender affected thereby; or (b) (i) amend, modify or waive any provision of this Section 10.1 or reduce the percentage specified in or otherwise modify the definition of Majority Lenders, or consent to the assignment or transfer by any Loan Party of any of its rights and obligations under this Agreement and the other Loan Documents (except as permitted by Section 6.4); or (ii) release any Loan Party from any liability under its respective Loan Documents; or (iii) release all or substantially all of the Collateral or all or substantially all of the Guarantor Collateral, except in connection with any Asset Disposition permitted by this Agreement; or (iv) amend, modify or waive, directly or indirectly, any of the provisions of Section 2.1(e) (the first sentence) or 2.10; or (v) amend, modify or waive any provision of this Agreement requiring the consent or approval of all Lenders, in each case without the written consent of all the Lenders; or (c) amend, modify or waive any provision of Section 8 without the written consent of the Agent. Any such waiver and any such amendment, supplement or modification shall apply equally to each of the Lenders and shall be binding upon the Borrower, the other Loan Parties, the Lenders, the Agent, and all future holders of the Revolving Loans. Notwithstanding the foregoing, any amendment, restatement or other modification to the agency letter between the Agent and the Borrower shall require the consent of the Agent and the Borrower only. In the case of any waiver, the Borrower, the other Loan Parties, the Lenders and the Agent, shall be restored to their former position and rights hereunder and under the other Loan Documents, and any Default waived shall be deemed to be cured and not continuing; but no such waiver shall extend to any subsequent or other Default, or impair any right consequent thereon.

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10.2 Notices. All notices, requests and demands or other communications to or upon the respective parties hereto to be effective shall be in writing unless otherwise expressly provided herein (including by telecopy), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered by hand, or three (3) days after being deposited in the United States mail, certified and postage prepaid and return receipt requested, or, in the case of telecopy notice, when received, in each case addressed to the parties at their addresses as set forth on the signature pages hereof or to such other address as may be hereafter notified by the respective parties hereto; provided that any notice, request or demand to or upon the Agent pursuant to Section 2.1, 2.3 or 2.4 shall not be effective until received.

The Agent shall be entitled to rely and act upon telephonic notices purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, (ii) such notices are found not to have been authorized by the Borrower or (iii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Borrower hereby indemnifies the Agent from all losses, costs, expenses and liabilities resulting from the reliance by the Agent on any such notice.

10.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of the Agent, any right, remedy, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

10.4 Survival of Representations and Warranties. All representations and warranties made hereunder and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement.

10.5 Payment of Expenses; Indemnification. (a) The Borrower agrees, whether or not the transactions contemplated hereby are consummated, (i) to pay or reimburse the Agent for all its reasonable, documented costs and out-of-pocket expenses incurred in connection with the preparation and execution of, the syndication of, and any amendment, supplement or modification to, this Agreement and the other Loan Documents and any other documents prepared in connection herewith or therewith, and the consummation and administration of the transactions contemplated hereby and thereby (including the transactions to occur on the Restatement Closing Date), including due diligence expenses (including, appraisal fees and costs) and the reasonable fees and disbursements of no more than one outside counsel to the Agent for each jurisdiction where Collateral is located and as to any amendment, supplement or modification to this Agreement or any other Loan Document and the administration of the transactions contemplated thereby, including in connection with any proceeding or negotiation of the type referred to in clause (ii) below, regardless of whether an Event of Default has occurred and is continuing, and with respect to the foregoing legal fees, without duplication thereof, the allocated reasonable costs of internal counsel to the Agent, (ii) after the occurrence and during the continuance of a Default, to pay or reimburse the Agent and the Lenders for all their reasonable, documented costs and out-of-pocket expenses incurred in connection with the enforcement or preservation of any rights under this Agreement, the other Loan Documents and

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any such other documents or in connection with any refinancing or restructuring of the Revolving Loans provided under this Agreement in the nature of a “work-out” or of any insolvency or bankruptcy proceeding, including reasonable legal fees and disbursements of one outside counsel to the Agent, one counsel to the Lenders and, if necessary, one local counsel in each jurisdiction where Collateral is located and, without duplication, the allocated reasonable cost of internal counsel to the Agent and the Lenders, and (iii) to indemnify and hold harmless the Agent and the Lenders from, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other taxes (other than Excluded Taxes), if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation or administration of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, this Agreement, the other Loan Documents and any such other documents.

(b) The Borrower and its Subsidiaries shall indemnify the Agent, each Lender and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any Person (including the Borrower or any other Loan Party) arising out of, in connection with, or as a result of (i) the execution or delivery of the Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, or, in the case of the Agent and its Related Parties only, the administration of this Agreement and the other Loan Documents, (ii) any Revolving Loan or the use or proposed use of the proceeds therefrom, (iii) the indemnification by the Agent of Houlihan Lokey, as set forth in the engagement agreement executed by the Agent for the valuation referred to in Section 4.1 of the Existing Credit Agreement and (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Loan Party or any of the Borrower’s or such Loan Party’s directors, shareholders or creditors and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee.

(c) To the fullest extent permitted by applicable Law, neither the Borrower nor any Subsidiary shall assert, and each such Loan Party hereby waives, and acknowledges that no other Person shall have, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Revolving Loan or the use of the proceeds thereof. No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in

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connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.

(d) The agreements in this Section shall survive the resignation of the Agent, the replacement of any Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all the other Obligations.

10.6 Successors and Assigns; Participation; Purchasing Lenders.

(a) This Agreement shall be binding upon and inure to the benefit of the Borrower, the Agent, all future holders of the Revolving Loans and their respective permitted successors and assigns, except that the Borrower may not assign, transfer or delegate any of its rights or obligations under this Agreement without the prior written consent of the Lenders.

(b) Any Lender may at any time sell to one or more banks or other entities (“Participants”) participating interests in the rights of such Lender hereunder and under the other Loan Documents; provided any such sale must result in the Participant acquiring at least a $5,000,000 risk participation interest in the aggregate amount of obligations under this Agreement and the other Loan Documents. A Participant shall have the right only to vote on the extension of regularly scheduled maturity of principal or interest with respect to the Revolving Loans or reduction of the principal amount or rate of interest on the Revolving Loans. In the event of any such sale by a Lender of participating interests to a Participant, such Lender’s obligations under this Agreement to the other parties to this Agreement shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, such Lender shall remain the holder of its Revolving Loans for all purposes under this Agreement and the other Loan Documents, and the Borrower and the Agent shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents.

(c) Any Lender may at any time sell to (i) any of its Affiliates, any other Lender or any Affiliate thereof or (ii) one or more additional lenders that are, subject to Section 10.6(d) below, approved by the Borrower (“Purchasing Lenders”), such approval not to be required for any assignee referred to in clause (i) or if an Event of Default has occurred and is continuing, and the Agent, all or any part of its rights and obligations under this Agreement and the other Loan Documents pursuant to an Assignment and Acceptance executed by such Purchasing Lender and such transferor Lender, and delivered to the Agent for its acceptance and recording in the Register (as defined below), accompanied by a $3,500 processing fee; provided, however, that any such sale (other than a sale of all of the selling Lender’s interest hereunder) must result in the Purchasing Lender having an interest in at least $5,000,000 in aggregate amount of obligations under this Agreement and the other Loan Documents. Upon such execution and delivery from and after the transfer effective date determined pursuant to such assignment document, (x) the Purchasing Lender thereunder shall be a party hereto and, to the extent provided in the Assignment and Acceptance, have the rights and obligations of a Lender hereunder with Commitments as set forth therein, and (y) the transferor Lender thereunder shall, to the extent of such assigned portion and as provided in the Assignment and Acceptance, be

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released from its obligations under this Agreement and the other Loan Documents (and, in the case of an Assignment and Acceptance covering all or the remaining portion of a transferor Lender’s rights and obligations under this Agreement, such transferor Lender shall cease to be a party hereto). Any such Assignment and Acceptance shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of such Purchasing Lender and the resulting adjustment of Commitment Percentages arising from the purchase by such Purchasing Lender of all or a portion of the rights and obligations of such transferor Lender under this Agreement and the other Loan Documents. Notwithstanding the foregoing, subject to Section 10.6(d) below, no Purchasing Lender shall be (i) the Borrower or an Affiliate thereof, (ii) a Defaulting Lender or (iii) a natural person.

At any time when an Event of Default has occurred and is continuing, any call by the Agent under the Equity Contribution Agreement or any Shareholder Guarantee shall be deemed to be notice to the Borrower that the Lenders may at any time and from time to time thereafter make assignment under this Section 10.6(c) without the requirement for any further notice to, or consent by, any Loan Party; provided that such Lender will wait fifteen (15) Business Days after the Agent makes any such call before consummating such assignment. In addition, at any time when an Event of Default has occurred and is continuing and the Agent has not made a call under the Equity Contribution Agreement or any Shareholder Guarantee, prior to any Lender making an assignment under this Section 10.6(c), such Lender shall give notice to the Borrower (with a copy to Agent) of its intent to make an assignment under this Section 10.6(c) and referring to Section 10.6(d) and, if such notice is given (i) such Lender will wait fifteen (15) days (the “Shareholder Sale Period”) before consummating such assignment and, during the Shareholder Sale Period, will instead make such assignment in accordance with Section 10.6(d) if the conditions therein are satisfied and (ii) if the Shareholder Sale Period elapses without consummation of such sale under Section 10.6(d), such Lender shall thereafter be entitled to effect an assignment under this Section 10.6(c) to any Person without the requirement for any further notice to, or consent by, any Loan Party. For the avoidance of doubt, once notice is given under either of the preceding two sentences, neither the Agent nor any Lender shall have any obligation to give any further or additional notice of any further assignments hereunder.

(d) Notwithstanding any provision in this Section 10.6 to the contrary, upon the written request of the MidOcean Entities and/or the Kayne Investors, in the event that all Obligations owing to the Agent and the Lenders under the Loan Documents will be paid to the Agent and the Lenders in full concurrently with such assignment, the Agent and each Lender will assign to the MidOcean Entities, the Kayne Investors and such other Guarantors as the MidOcean Entities or the Kayne Investors shall indicate, such sale to be consummated within fifteen (15) days of the receipt of such written request unless the Agent shall agree to a different time period in its discretion, its respective rights and interests under the Loan Documents, without recourse or representation and against receipt of such payment in full, at the sole expense of such assignees, pursuant to such documentation as the MidOcean Entities, the Kayne Investors and such other Guarantors shall reasonably request.

(e) The Agent shall maintain at its address referred to in Section 10.2 a copy of each Assignment and Acceptance delivered to it and a register (the “Register”) for the recordation of the names and addresses of the Lenders and the Commitments of, and principal amounts of the Revolving Loans owing to each Lender from time to time. The entries in the

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Register shall be conclusive, in the absence of manifest error, and the Borrower, the Agent and the Lenders may treat each Person whose name is recorded in the Register as the owner of the Revolving Loans recorded therein for all purposes of this Agreement. The Register shall be available for inspection by the Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice.

(f) Upon its receipt of an Assignment and Acceptance executed by a transferor Lender and Purchasing Lender (and, in the case of a Purchasing Lender that is not then a Lender or an Affiliate thereof, by the Borrower (if required) and the Agent) the Agent shall (i) promptly accept such Assignment and Acceptance and (ii) on the effective date determined pursuant thereto record the information contained therein in the Register.

(g) The Borrower authorizes each Lender to disclose to any Participant or Purchasing Agent (each, a “Transferee”) and any prospective Transferee any and all information in such Lender’s possession concerning the Borrower, the other Loan Parties, and the Affiliates and Subsidiaries of any of the foregoing which has been delivered to such Lender by or on behalf of the Borrower pursuant to this Agreement or any other Loan Document or which has been delivered to such Lender by or on behalf of the Borrower in connection with such Lender’s credit evaluation of the Borrower and the other Loan Parties; provided that such Transferee or prospective Transferee agrees in writing to maintain the confidentiality of such information in accordance with the provisions of Section 10.15.

(h) Nothing herein shall prohibit any Lender from pledging or assigning any of its interest and rights under this Agreement and its Revolving Loans to any Federal Reserve Bank in accordance with applicable law.

(i) Each Lender (and each Person becoming a Lender pursuant to Section 10.6(c)) represents, warrants and agrees with the Agent as follows:

(i) Such Lender is entitled to receive any payments hereunder without the withholding of any tax and will furnish to Agent such forms, certifications, statements and other documents as Agent may request from time to time to evidence such Lender’s exemption from withholding of any tax imposed by any jurisdiction or to enable Agent to comply with any applicable laws or regulations relating thereto;

(ii) Without limiting the effect of the foregoing, if such Lender is not created or organized under the laws of the United States or any state thereof, such Lender is lawfully engaged in the conduct of a business within the United States and payments made hereunder are or are reasonably expected to be effectively connected with the conduct of that trade or business and are or will be includible in its gross income or, if such Lender is not engaged in a United States trade or business with which such payments are effectively connected, such Lender is entitled to the benefits of a tax convention which exempts the income from United States withholding tax and that it has satisfied all requirements to qualify for the exemption from tax.

(iii) Such Lender agrees that it will, immediately upon the request of the Agent, furnish to the Agent with a copy to the Borrower Form W-9, W-8BEN or W-8ECI

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(as applicable to it) of the Internal Revenue Service, or such other forms, certifications, statements or documents, duly executed and completed by such Lender as evidence of such Lender’s exemption from the withholding of United States tax with respect thereto. If such Lender determines that, as a result of any change in any Requirement of Law or in any official application or interpretation thereof, it ceases to qualify for exemption from any tax imposed by any jurisdiction with respect to payments made hereunder, such Lender shall promptly notify the Agent of such fact and the Agent may, but shall not be required to withhold the amount of any such applicable tax from amounts paid to such Lender hereunder. The Agent shall not be obligated to make any payments hereunder to such Lender in respect to the Obligations owing to such Lender hereunder until such Lender shall have furnished to the Agent the requested form, certification, statement or document, and may withhold the amount of such applicable tax from amounts paid to such Lender hereunder.

(iv) Each Lender shall reimburse, indemnify and hold the Agent and Borrower harmless from any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever which may be imposed upon, incurred by or asserted against the Agent due to its reliance upon the representation hereby made that such Lender is exempt from withholding of tax. Unless the Agent receives written notice to the contrary, such Lender shall be deemed to have made the representations contained in this Section 10.6(i) for the current and each subsequent tax year of such Lender.

10.7 Adjustments; Set-Off. (a) If any Lender (a “benefitted Lender”) shall at any time receive any payment of all or part of its Revolving Loans, or interest thereon, or fees, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in Section 7.1(g) or 8.8, or otherwise), in a greater proportion than any such payment to or collateral received by any other Lender, if any, in respect of such other Lender’s Revolving Loans or interest thereon, or fees, such benefitted Lender shall purchase for cash from the other Lenders such portion of each such other Lender’s Revolving Loans or fees, or shall provide such other Lenders with the benefits of any such collateral, or the proceeds thereof, as shall be necessary to cause such benefitted Lender to share the excess payment or benefits of such collateral or proceeds ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such benefitted Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest. The Borrower agrees that each Lender so purchasing a portion of another Lender’s Revolving Loans may exercise all rights of payment (including, without limitation, rights of set-off) with respect to such portion as fully as if such Lender were the direct holder of such portion.

(b) In addition to any rights and remedies of the Agent provided by law, the Agent shall have the right, exercisable upon the occurrence and during the continuance of an Event of Default, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent permitted by applicable law, to set-off and appropriate and apply against any such Obligations any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured,

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at any time held or owing by the Agent or any branch or agency thereof or bank controlling the Agent to or for the credit or the account of the Borrower. The Agent agrees promptly to notify the Borrower after any such set-off and application made by the Agent, provided that the failure to give such notice shall not affect the validity of such set-off and application.

10.8 Counterparts. This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by telecopier or electronically shall be effective as delivery of a manually executed counterpart of this Agreement.

10.9 Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

10.10 Integration. This Agreement, together with the other Loan Documents, represents the entire agreement of the Borrower, the Lenders and the Agent with respect to the subject matter hereof, and there are no promises, undertakings, representations or warranties by the Agent or any Lender relative to the subject matter hereof not expressly set forth or referred to herein or in the other Loan Documents.

10.11 GOVERNING LAW; JURISDICTION.

(a) This Agreement and the rights and obligations of the Borrower hereunder shall be governed by, and shall be construed and enforced in accordance with, the laws of the State of New York without regard to conflict of laws principles thereof.

(b) All judicial proceedings brought against the Borrower arising out of or relating hereto, or any of the Borrower’s obligations hereunder, may be brought in any state or Federal court of competent jurisdiction in the State, County and City of New York. By executing and delivering this Agreement, the Borrower, for itself and in connection with its properties, irrevocably (a) accepts generally and unconditionally the nonexclusive jurisdiction and venue of such courts; (b) waives any defense of forum non conveniens; (c) agrees that service of all process in any such proceeding in any such court may be made by registered or certified mail, return receipt requested, to the Borrower at its address provided on the first page hereof; (d) agrees that service as provided in clause (c) above is sufficient to confer personal jurisdiction over the Borrower in any such proceeding in any such court, and otherwise constitutes effective and binding service in every respect; and (e) agrees that the Agent retains the right to serve process in any other manner permitted by law or to bring proceedings against the Borrower in the courts of any other jurisdiction.

10.12 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY AND AGREES THAT ANY SUCH

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ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH OF THE PARTIES HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN EXECUTING AND ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH OF THE PARTIES HERETO WARRANTS AND REPRESENTS THAT EACH HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.

10.13 Acknowledgements.

The Borrower hereby acknowledges that:

(a) it has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Loan Documents;

(b) neither the Agent nor any Lender has any fiduciary relationship to the Borrower solely by virtue of any of the Loan Documents, and the relationship pursuant to the Loan Documents between the Agent and the Lenders on one hand, and the Borrower on the other hand, is solely that of creditor and debtor; and

(c) no joint venture exists among the Lenders, or among the Borrower and the Lenders.

10.14 Headings. Section headings herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.

10.15 Confidentiality. The Agent and each Lender shall take reasonable precautions, in accordance with their customary procedures for handling confidential information of the same nature, to maintain the confidentiality of all non-public information obtained pursuant to the requirements of this Agreement or any other Loan Document which has been identified in writing as such by any Loan Party but may, in any event, make disclosures (a) to any of its Affiliates and as reasonably required by any transferee, assignee or participant in connection with the contemplated transfer or assignment of any of the Commitments, the Revolving Loans or participation in any of the foregoing or (b) as required or requested by any governmental agency or representative thereof or as required pursuant to legal process or (c) to its attorneys and accountants or (d) as required by law or (e) in connection with litigation involving the Agent or any Lender; provided that (i) such transferee, assignee or participant agrees in writing to comply with the provisions of this Section 10.15 and (ii) in no event shall the Agent or any Lender be obligated or required to return any materials furnished by the Borrower and its Subsidiaries.

10.16 Subordination Agreement. Each Lender from time to time party hereto acknowledges and agrees that the Obligations hereunder are subject to the Subordination Agreement, in each case on the terms and to the extent set forth in the Subordination Agreement. Each Lender, by executing this Agreement, or any Assignment and Acceptance or New Lender Joinder pursuant to which it becomes a party to this Agreement, acknowledges that such Lender is bound by the terms thereof.

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10.17 Patriot Act. Each Lender subject to USA PATRIOT Improvement and Reauthorization Act, Title III of Pub. L. 109-177 (signed into law March 9, 2009) (the “PATRIOT Act”) hereby notifies the Borrower that, pursuant to the requirements of the PATRIOT Act, such Lender is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with the PATRIOT Act.

[Remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

PROFESSOR CONNOR’S, INC.
By:
Name:	S MACCHIAVERNA
Title:	SECRETARY
Address for Notices:
400 Plaza Drive Secaucus, NJ 07094 Attention: Richard Kassar Facsimile: (201) 866-2018

Credit Agreement

ONEWEST BANK, FSB, as Agent and a Lender

By:

Name:

Title:

Revolving Loan Commitment: $[45,000,000]

Address for Notices:

OneWest Bank, FSB

888 East Walnut Street

HQ-05-03

Pasadena, California 91101

Attention: David Ligon

Telephone: 626-535-4466

Facsimile: 866-486-5720

Credit Agreement

Schedule 1.1(a)

Shareholder Guarantors

Guarantor	Amount		%
MidOcean Partners III, L.P.	$	19,482,000		32.47	%
MidOcean Partners III-A, L.P.	$	10,356,000		17.26	%
MidOcean Partners III-D, L.P	$	1,662,000		2.77	%
Mid Ocean Sub-Total	$	31,500,000		52.50	%
Dick Kassar	$	600,000		1.00	%
Richard Thompson	$	900,000		1.50	%
Management Sub-Total	$	1,500,000		2.50	%
Richard and Suzanne Kayne Living Trust u/t/d 1/14/99	$	7,548,425		12.58	%
Norris Trust dtd 6/18/02	$	4,016,595		6.69	%
Michael Targoff	$	2,060,693		3.43	%
Armstrong Trust u/t/d 9/14/2000	$	1,850,000		3.00	%
David J. Shladovsky	$	1,500,000		2.50	%
Mohn Family Trust	$	1,338,044		2.23	%
James Stern	$	1,331,669		2.22	%
Peter Neuwirth Trust dtd 12/9/91	$	993,084		1.66	%
Douglas Hampson Revocable Living Trust (2006)	$	829,170		1.38	%
James R. Wilcox	$	820,950		1.37	%
Patricia Neuwirth Trust dtd 2/5/91	$	738,375		1.23	%
David L. Mahoney and Winnifred C. Ellis 1998 Trust dtd 6/25/98	$	629,115		1.05	%
Jeffrey P. Hughes	$	532,782		0.89	%
The Lieberthal Trust dtd 3/23/99	$	494,412		0.82	%
Howard & Marcie Zelikow Living Trust dtd 5/30/07	$	457,622		0.76	%
Rudnick Living Trust (1999 Restatement)	$	375,000		0.63	%
William A. Goldstein	$	225,561		0.38	%
Joseph E. Parzick	$	210,045		0.35	%
Lawrence S. Coben	$	184,365		0.31	%
Levine-Zacharius Living Trust dtd 11/17/1989	$	183,681		0.31	%
Douglas A. & Lori A. Schur Family Trust dtd 5/1/97	$	168,641		0.28	%
Sasqua Fields Partners, LLC	$	100,000		0.25	%
Silvers Living Trust dtd 2/11/04	$	112,500		0.19	%
Levine Family Investment, LP	$	100,137		0.17	%
Marilyn S. Moscrip	$	90,392		0.15	%
Scott Racine	$	59,903		0.10	%
Walters Family Trust dtd 8/25/05	$	34,871		0.06	%

Credit Agreement

Guarantor	Amount		%
Lynn Horn	$	13,968		0.02	%
Freshpet Investors Sub-total	$	27,000,000		45.00	%
Total All Guarantees	$	60,000,000		100.00	%

Credit Agreement

Schedule 1.1(b)

Permitted Holders

1. Freshpet Investors LLC

2. Tyson Foods

3. Iron Street Partners, LLC

4. Thompson FP Foods, LLC

5. City National Corporation

6. MidOcean Entities

Credit Agreement

TABLE OF CONTENTS

		Page
SECTION 1. DEFINITIONS			1
1.1	Defined Terms		1
1.2	Other Definitional Provisions		21
SECTION 2. AMOUNT AND TERMS OF REVOLVING LOANS; COMMITMENT AMOUNTS			21
2.1	Revolving Loans; Revolving Loan Commitments		21
2.2	Optional Prepayments; Optional Commitment Reductions		23
2.3	Mandatory Prepayments; Mandatory Commitment Reductions		24
2.4	Conversion and Continuation Options		25
2.5	Minimum Amounts of Tranches; Minimum Borrowings		25
2.6	Interest Rates and Payment Dates		25
2.7	Computation of Interest and Fees		26
2.8	Inability to Determine Interest Rate		26
2.9	Pro Rata Treatment and Payments		26
2.10	Illegality		27
2.11	Increased Costs		27
2.12	Taxes		28
2.13	Indemnity		29
2.14	Mitigation of Costs		29
2.15	Unused Commitment Fee		29
2.16	Increase of Revolving Commitments		30
SECTION 3. REPRESENTATIONS AND WARRANTIES			30
3.1	Financial Condition		30
3.2	Corporate Existence; Compliance with Law, Etc.		31
3.3	Corporate Power; Authorization; Consents; Enforceable Obligations		31
3.4	No Legal Bar		31
3.5	No Material Litigation		32
3.6	Ownership of Property; Liens; Condition of Properties		32
3.7	Environmental Matters		32
3.8	Intellectual Property		32
3.9	Taxes		33
3.10	Federal Regulations		33
3.11	ERISA Compliance		33
3.12	Investment Company Act		33
3.13	Subsidiaries		33
3.14	Purpose of Revolving Loans		33
3.15	Accuracy and Completeness of Information		33
3.16	[Intentionally Omitted]		34
3.17	[Intentionally Omitted]		34
3.18	[Intentionally Omitted]		34
3.19	Capital Structure and Equity Ownership		34
3.20	Insolvency		34

- i -

SECTION 4. CONDITIONS PRECEDENT		34
4.1	Conditions to Restatement Closing Date	34
4.2	Conditions to Each Revolving Loan	35
SECTION 5. AFFIRMATIVE COVENANTS		36
5.1	Financial Statements	36
5.2	Certificates; Other Information	37
5.3	Payment of Taxes	38
5.4	Conduct of Business and Maintenance of Existence	38
5.5	Maintenance of Property; Insurance	38
5.6	Inspection of Property; Books and Records; Discussions	39
5.7	Use of Proceeds	39
5.8	Plant	39
5.9	Acquisition of Assets	39
5.10	Environmental Laws	39
5.11	Covenants Regarding Subsidiaries	40
5.12	Canadian Subsidiary	40
SECTION 6. NEGATIVE COVENANTS		41
6.1	Financial Condition Covenant	41
6.2	Limitation on Indebtedness	41
6.3	Limitation on Liens	42
6.4	Limitation on Fundamental Changes	43
6.5	Limitation on Sale of Assets	44
6.6	Limitation on Restricted Payments	44
6.7	[Intentionally Omitted]	44
6.8	Transactions with Affiliates	44
6.9	Fiscal Year	45
6.10	Prohibitions on Certain Agreements	45
6.11	Line of Business	45
6.12	Anti-Terrorism Laws	45
SECTION 7. EVENTS OF DEFAULT		45
7.1	Events of Default	45
7.2	Cure of Guarantor Default	48
7.3	Application of Payments and Proceeds	49
SECTION 8. THE AGENT		49
8.1	Appointment	49
8.2	Delegation of Duties	50
8.3	Exculpatory Provisions	50
8.4	Reliance by Agent	50
8.5	Notice of Default	51
8.6	Non-Reliance on Agent and Other Lenders	51
8.7	Indemnification	51

- ii -

8.8	Agent in Its Individual Capacity	52
8.9	Successor Agent	52
8.10	Administrative Agent May File Proofs of Claim	52
8.11	Collateral Matters	53
SECTION 9. SECURITY		53
9.1	Grant of Security Interest	53
9.2	Negotiable Collateral	54
9.3	Collection of Accounts, General Intangibles and Negotiable Collateral	54
9.4	Filing of Financing Statements; Commercial Tort Claims; Delivery of Additional Documentation Required	54
9.5	Power of Attorney	55
9.6	Right to Inspect	56
SECTION 10. MISCELLANEOUS		56
10.1	Amendments and Waivers	56
10.2	Notices	57
10.3	No Waiver; Cumulative Remedies	57
10.4	Survival of Representations and Warranties	57
10.5	Payment of Expenses; Indemnification	57
10.6	Successors and Assigns; Participation; Purchasing Lenders	59
10.7	Adjustments; Set-Off	62
10.8	Counterparts	63
10.9	Severability	63
10.10	Integration	63
10.11	GOVERNING LAW; JURISDICTION	63
10.12	WAIVER OF JURY TRIAL	63
10.13	Acknowledgements	64
10.14	Headings	64
10.15	Confidentiality	64
10.16	Subordination Agreement	64
10.17	Patriot Act	65

- iii -

Exhibits
A	Form of Revolving Note
B	Form of No Default/Representation Certificate
C	Form of Continuation Notice
D	Form of Borrowing Notice
E	Form of Covenant Compliance Certificate
F	Form of Assignment and Acceptance
G	Form of New Lender Joinder
Schedules
1.1(a)	Guarantors
1.1(b)	Permitted Holders
1.1(c)	Commercial Tort Claims
3.2	Qualification Jurisdictions
3.5	Litigation
3.6	Legal and Operating Names
3.8	Intellectual Property Matters
3.13	Subsidiaries
3.19	Capital Structure and Equity Ownership

- iv -

AMENDED AND RESTATED CREDIT AGREEMENT

among

PROFESSOR CONNOR’S, INC.

a Delaware corporation

THE LENDERS PARTIES HERETO

and

ONEWEST BANK, FSB

as Administrative Agent

Dated as of April 12, 2013

EX-10.2

Exhibit 10.2

Execution Version

FIRST AMENDMENT TO

AMENDED AND RESTATED CREDIT AGREEMENT

This FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”), dated as of May 7, 2013 (the “First Amendment Effective Date”), among (1) PROFESSOR CONNOR’S, INC., a Delaware corporation (the “Borrower”) (2) the several banks and other lenders from time to time parties to this Agreement (the “Lenders”) and (3) ONEWEST BANK, FSB (“OneWest Bank”), as administrative agent for the Lenders (in such capacity, the “Agent”).

RECITALS

A. The Borrower and the Lenders are party to that certain Amended and Restated Credit Agreement, dated as of April 15, 2013 (the “Credit Agreement”) pursuant to which the Lenders made available to the Borrower a revolving loan facility in the maximum principal amount of $45,000,000. Capitalized terms used herein and not defined shall have the meanings ascribed to them in the Credit Agreement. The Borrower and the Lenders have agreed to make certain changes to the Credit Agreement as set forth herein.

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, the parties hereto hereby agree as follows:

SECTION 1. Amendments To Credit Agreement. The Credit Agreement is hereby amended as follows:

(a) Section 7.2(b) is hereby deleted and replaced with a new clause (b) as follows:

“(b) Cause one or more Persons acceptable to the Agent to become new Guarantors hereunder having a Covered Amount equal to the Covered Amount of the Non-Compliant Guarantor; provided that any new Person who becomes a new Guarantor hereunder with Covered Amount in excess of $500,000 must be acceptable to all Lenders. Such new Guarantor shall execute in favor of the Agent a Shareholder Guarantee or an Equity Contribution Agreement, as applicable, substantially in the form of the Shareholder Guarantees and Equity Contribution Agreement in existence on the Restatement Closing Date or as thereafter amended. Such new Guarantee shall be accompanied by (i) such financial statements and other financial information evidencing the financial condition of such Guarantor as the Agent shall request, including evidence of “Liquidity” or “Uncalled Capital Commitments”, as applicable, of such Guarantor corresponding to its Covered Amount in form and substance acceptable to Agent; provided that if such Guarantor has a Covered Amount in excess of $500,000, the information provided by such Guarantor in clause (i) above must be as requested by Agent or any Lender and must be in form and substance acceptable to all Lenders, (ii) certified copies of its formation documents, resolutions and an incumbency certificate, (iii) an opinion of counsel to such new Guarantor in form, and from a firm, satisfactory to the Agent and (iv) such other information regarding such new Guarantor as Agent or any Lender shall request; or”

SECTION 2. Conditions Precedent to First Amendment Effective Date. This Amendment shall become effective upon receipt by the Agent of this Amendment, duly executed by the Borrower, the Agent, and the Lenders.

SECTION 3. Reference To And Effect On The Credit Agreement And The Other Loan Documents. Upon the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to “the Credit Agreement,” “thereunder,” “thereof,” “therein” or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended hereby.

(a) Except as specifically amended herein or in any other amendment executed in connection herewith, the Credit Agreement and all other Loan Documents are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed.

(b) The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Agent or the Lenders under the Credit Agreement or any other Loan Documents, nor constitute a waiver of any provision of the Credit Agreement or any other Loan Documents.

SECTION 4. Representations And Warranties. The Borrower represents and warrants to the Agent and the Lenders as follows: (i) it has all requisite power and authority under applicable law and under its organizational documents to execute, deliver and perform this Amendment, and to perform the Credit Agreement as amended hereby; (ii) all actions, waivers and consents (corporate, regulatory and otherwise) necessary or appropriate for it to execute, deliver and perform this Amendment, and to perform the Credit Agreement as amended hereby, have been taken and/or received; (iii) this Amendment, and the Credit Agreement, as amended by this Amendment, constitute the legal, valid and binding obligation of it enforceable against it in accordance with the terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law); (iv) the execution, delivery and performance of this Amendment, and the performance of the Credit Agreement, as amended hereby, will not violate in any material respect any Requirement of Law applicable to any of the Loan Parties or material Contractual Obligation of any of the Loan Parties, and will not result in, or require, the creation or imposition of any Lien on any of its properties or revenues pursuant to any such Requirement of Law or such material Contractual Obligation, except as permitted by to the Loan Documents; and (v) after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing.

SECTION 5. Execution In Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this Amendment electronically shall be effective as delivery of a manually executed counterpart of this Amendment.

- 2 -

SECTION 6. Governing Law. This Amendment and the rights and obligations of the parties under this Amendment shall be governed by, and construed and interpreted in accordance with, the law of the State of New York (without reference to its choice of law rules).

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

PROFESSOR CONNOR’S, INC.,
a Delaware corporation
By:
Name:	Richard A. Kassar
Title:	President

Signature Page to First Amendment to Amended and Restated Credit Agreement

ONEWEST BANK, FSB, as Agent and a Lender
By:
Name:	David Ligon
Title:	Executive Vice President

Signature Page to First Amendment to Amended and Restated Credit Agreement

EX-10.3

Exhibit 10.3

Execution Version

SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT

This SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”), dated as of July 2, 2013 (the “Second Amendment Effective Date”), among (1) PROFESSOR CONNOR’S, INC., a Delaware corporation (the “Borrower”), (2) the several banks and other lenders from time to time parties to this Agreement (the “Lenders”) and (3) ONEWEST BANK, FSB (“OneWest Bank”), as administrative agent for the Lenders (in such capacity, the “Agent”).

RECITALS

A. The Borrower, the Agent and the Lenders are party to that certain Amended and Restated Credit Agreement, dated as of April 15, 2013 as amended by that certain First Amendment to Amended and Restated Credit Agreement, dated as of May 7, 2013 (as amended, the “Credit Agreement”) pursuant to which the Lenders have made available to the Borrower a revolving loan facility in the maximum principal amount of $50,000,000. Capitalized terms used herein and not defined shall have the meanings ascribed to them in the Credit Agreement. The Borrower and the Lenders have agreed to make certain changes to the Credit Agreement as set forth herein.

NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein, the parties hereto hereby agree as follows:

SECTION 1. Amendments to Credit Agreement. The Credit Agreement is hereby amended as follows:

(a) The following definition shall be added to Section 1.1 of the Credit Agreement in alphabetical order:

““PIK Subordinated Debt”: Indebtedness of Borrower that is on terms and conditions (including payment terms, interest rates, covenants, remedies, defaults and other material terms) satisfactory to the Agent and (a) which has been expressly subordinated in right of payment to all Obligations by the execution and delivery of a subordination agreement, in form and substance satisfactory to the Agent, in its sole discretion, prior to the incurrence of such indebtedness, (b) if such Indebtedness is secured by a Lien, such Lien is expressly subordinated to the Liens granted to Agent by the execution and delivery of a subordination agreement in form and substance satisfactory to the Agent, in its sole discretion, prior to the creation of such Lien, (c) has a maturity date that occurs at least 6 months after the Revolving Loan Commitment Expiration Date, and (d) the interest under which is solely paid in kind and not in cash during the entire term of such Indebtedness.”

(b) The definitions of “Majority Lenders”, “Subordinated Debt” and “Total Debt” in Section 1.1 of the Credit Agreement are hereby deleted in their entirety and replaced with the following:

““Majority Lenders”: Lenders having Revolving Loan Commitments equal to or more than 50.1% of the aggregate Revolving Loan Commitment, or, if any Revolving Loan Commitment has terminated, with respect to such Revolving Loan Commitment, Lenders with outstanding Loans under such Commitment having an

unpaid principal balance equal to or more than 50.1% of the sum of the unpaid principal balance of all Revolving Loans outstanding, excluding from such calculation Lenders which have failed or refused to fund a Revolving Loan when required to do so; provided that if at any time there is more than one Lender, Majority Lenders must include at least two Lenders.”

““Subordinated Debt”: Indebtedness of Borrower that is on terms and conditions (including payment terms, interest rates, covenants, remedies, defaults and other material terms) satisfactory to Majority Lenders and which (a) has been expressly subordinated in right of payment to all Obligations by the execution and delivery of a subordination agreement, in form and substance satisfactory to the Agent, in its sole discretion, prior to the incurrence of such indebtedness, (b) if such Indebtedness is secured by a Lien, such Lien is expressly subordinated to the Liens granted to Agent by the execution and delivery of a subordination agreement, in form and substance satisfactory to Majority Lenders, in their sole discretion, prior to the creation of such Lien, and (c) has a maturity date that occurs at least 6 months after the Revolving Loan Commitment Expiration Date.”

““Total Debt”: as of any date of determination, without duplication, the remainder of (a) all Indebtedness for borrowed money of such Person (including any Subordinated Debt), determined on a consolidated basis in accordance with GAAP (other than PIK Subordinated Debt and Preferred Stock that is not Prohibited Preferred Stock), including, in any event, but without duplication, with respect to Borrower and its Subsidiaries, the Revolving Loans, and the amount of their Capitalized Lease Obligations, in each case exclusive of Indebtedness owed by one Loan Party to another Loan Party and any Indebtedness in respect of any of the foregoing less (b) all cash and Cash Equivalents on the balance sheet of the Borrower and its Subsidiaries at such date.”

(c) Section 2.16(a) of the Credit Agreement is hereby deleted in its entirety and replaced with the following:

“(a) The Borrower may, by written notice to the Agent (a “Commitment Increase Notice”), at any time request increases of the aggregate Revolving Commitment (a “Revolving Commitment Increase”); provided that (i) the aggregate amount of Revolving Loan Commitment Increases occurring after the Restatement Closing Date shall not result, at any time, in aggregate Revolving Loan Commitments in excess of $70,000,000 (the “Maximum Commitment Amount”) (unless the Majority Lenders shall otherwise commit in writing); (ii) each exercise of the increase request option shall be in a minimum principal amount of not less than $5,000,000; provided that the exercise of such increase request option may be less than $5,000,000 if the unused portion of the Maximum Commitment Amount is less than $5,000,000, so long as such request is for the full amount of the remaining Maximum Commitment Amount; (iii) any Revolving Commitment Increase resulting in a Maximum Commitment Amount in excess of $60,000,000 shall be conditioned about the Agent’s receipt of (w) amendments to the Guarantees such that the aggregate Covered Amount of the Guarantees is not less than the new aggregate Revolving Loan Commitment after taking into account the Revolving Commitment

- 2 -

Increase, (x) a Liquidity Compliance Certificate from each Guarantor whose Guarantee is being increased, prepared on a pro forma basis assuming such increase, (y) a modification of the Plant Mortgage and such endorsement(s) to the title policy therefore as the Agent may request and (z) an amendment to the Subordination Agreement to address the increased Commitment amount, and (iv) no such increase may be requested when a Default or Event of Default has occurred and is continuing. Each such notice shall specify (A) the date (each, an “Increased Amount Date”) on which Borrower proposes that the Revolving Commitment Increase shall be effective and (B) the requested amount of such increase. Notwithstanding any term of this Agreement to the contrary, neither the Agent nor any Lender shall be deemed to have committed to any Revolving Commitment Increase unless such Lender executes and delivers an Increased Commitment Letter (as defined below); for the avoidance of doubt, any Lender may accept or decline to provide a Revolving Commitment Increase in its sole discretion.”

(d) Section 3.6 of the Credit Agreement is hereby amended by adding at the end thereof the following sentence:

“As of the Restatement Closing Date, the Plant is the sole property mortgaged to the Agent.”

(e) Section 6.1(a)(i) of the Credit Agreement is hereby deleted in its entirety and replaced with the following:

“(i) Total Debt (including all loans and other credit extensions outstanding under the Senior Credit Agreement, but excluding any debt owed to any shareholder of the Borrower or their Affiliates) to”

(f) Section 6.2(g) of the Credit Agreement is hereby deleted in its entirety and replaced with the following:

“(g) Subordinated Debt and PIK Subordinated Debt; provided that the aggregate principal amount of Subordinated Debt (other than PIK Subordinated Debt) outstanding at any time shall not exceed $10,000,000; and”

(g) Section 6.3(k) of the Credit Agreement is hereby deleted in its entirety and replaced with the following:

“(k) Liens securing Indebtedness permitted by Section 6.2 and not referred to in any other provision of this Section 6.3, so long as such Liens (i) are for Subordinated Debt or PIK Subordinated Debt and (ii) do not encumber the property subject to the Plant Mortgage.”

(h) Section 7.2(c) of the Credit Agreement is hereby deleted in its entirety and replaced with the following:

“(c) Such Guarantor Default shall be otherwise cured or waived in writing to the satisfaction of the Majority Lenders.”

- 3 -

(i) Section 10.1 of the Credit Agreement is hereby amended by adding thereto a new clause (vi) after the existing clause (v) as follows:

“or, (vi) amend, modify or waive, directly or indirectly, any of the provisions of Section 7.3,”

(j) Section 10.6(d) of the Credit Agreement is hereby amended by adding the phrase “(such extension shall not exceed thirty (30) days without the consent of Majority Lenders)” immediately after the word “discretion” therein.

SECTION 2. Conditions Precedent to Second Amendment Effective Date. This Amendment shall become effective upon receipt by the Agent of this Amendment, duly executed by the Borrower, the Agent, and the Lenders.

SECTION 3. Reference To And Effect On The Credit Agreement And The Other Loan Documents. Upon the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein” or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to “the Credit Agreement,” “thereunder,” “thereof,” “therein” or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended hereby.

(a) Except as specifically amended herein or in any other amendment executed in connection herewith, the Credit Agreement and all other Loan Documents are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed.

(b) The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Agent or the Lenders under the Credit Agreement or any other Loan Documents, nor constitute a waiver of any provision of the Credit Agreement or any other Loan Documents.

SECTION 4. Representations And Warranties. The Borrower represents and warrants to the Agent and the Lenders as follows: (i) it has all requisite power and authority under applicable law and under its organizational documents to execute, deliver and perform this Amendment, and to perform the Credit Agreement as amended hereby; (ii) all actions, waivers and consents (corporate, regulatory and otherwise) necessary or appropriate for it to execute, deliver and perform this Amendment, and to perform the Credit Agreement as amended hereby, have been taken and/or received; (iii) this Amendment, and the Credit Agreement, as amended by this Amendment, constitute the legal, valid and binding obligation of it enforceable against it in accordance with the terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law); (iv) the execution, delivery and performance of this Amendment, and the performance of the Credit Agreement, as amended hereby, will not violate in any material respect any Requirement of Law applicable to any of the Loan Parties or material Contractual Obligation of any of the Loan Parties, and will not result in, or require, the creation or imposition of any Lien on any of its properties or revenues pursuant to any such Requirement of Law or such material Contractual Obligation, except as permitted by to the Loan Documents; and (v) after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing.

- 4 -

SECTION 5. Execution In Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this Amendment electronically shall be effective as delivery of a manually executed counterpart of this Amendment.

SECTION 6. Governing Law. This Amendment and the rights and obligations of the parties under this Amendment shall be governed by, and construed and interpreted in accordance with, the law of the State of New York (without reference to its choice of law rules).

[SIGNATURE PAGE FOLLOWS]

- 5 -

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

PROFESSOR CONNOR’S, INC., a Delaware corporation
By:
Name:	Richard A Kassar
Title:	CFO

Signature Page to Second Amendment to Amended and Restated Credit Agreement

ONEWEST BANK, FSB, as Agent and a Lender
By:
Name:	DAVID LIGON
Title:	EXECUTIVE VICE PRESIDENT

Signature Page to Second Amendment to Amended and Restated Credit Agreement

CITY NATIONAL BANK, as a Lender
By:
Name:	Garen Papazyan
Title:	Senior Vice President

PURSUANT TO SECTION 11 OF THE SUBORDINATION AGREEMENT, THE UNDERSIGNED, CONSENTS TO THE AMENDMENT TO THE CREDIT AGREEMENT SET FORTH IN SECTION 1(E) OF THIS AMENDMENT.
CITY NATIONAL BANK, as Senior Lender
By:
Name:	Garen Papazyan
Title:	Senior Vice President

Signature Page to Second Amendment to Amended and Restated Credit Agreement

EX-10.4

Exhibit 10.4

September 30, 2013

PROFESSOR CONNOR’S, INC.

400 Plaza Drive

Secaucus, NJ 07094

Attention: Richard Kassar

Re: Freshpet /Third Amendment to Amended and Restated Credit Agreement

Ladies and Gentlemen:

We refer to that certain Amended and Restated Credit Agreement dated as of April 15, 2013, as amended by that certain First Amendment to Amended and Restated Credit Agreement, dated as of May 7, 2013 and that certain Second Amendment to Amended and Restated Credit Agreement, dated as of July 3, 2013 (as the same may be further amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and among (1) Professor Connor’s, Inc., a Delaware corporation, (“Borrower”), (2) the lenders party thereto from time to time (the “Lenders”) and (3) OneWest Bank, FSB, as administrative agent to the Lenders (the “Agent”). Capitalized terms used herein and not defined shall have the meanings assigned to them in the Credit Agreement.

Certain Guarantors desire to reallocate amongst themselves $300,000 in principal amount of their respective Guarantees, such that the new amounts of their respective guarantees will be as set forth in the “Amount” column of Schedule 1.1(a) to the Credit Agreement. The Agent and the Lenders have agreed to such request, subject to the terms and conditions set forth herein.

1. Revised Schedule 1.1(a) to the Credit Agreement. Schedule 1.1(a) of the Credit Agreement is hereby deleted in its entirety and replaced with Schedule 1.1(a), attached hereto.

2. Effectiveness. This amendment shall become effective as of the date first set forth above upon receipt by the Agent of (i) this Third Amendment to Amended and Restated Credit Agreement duly executed by the Borrower and the Majority Lenders and (ii) amendments, in form and substance satisfactory to the Agent, to the affected Guarantees.

3 Representations. The Borrower represents and warrants to the Agent and the Lenders as follows: (i) it has all requisite power and authority under applicable law and under its organizational documents to execute, deliver and perform this Amendment, and to perform the Credit Agreement as amended hereby; (ii) all actions, waivers and consents (corporate, regulatory and otherwise) necessary or appropriate for it to execute, deliver and perform this Amendment, and to perform the Credit Agreement as amended hereby, have been taken and/or received; (iii) this Amendment, and the Credit Agreement, as amended by this Amendment, constitute the legal, valid and binding obligation of it enforceable against it in accordance with the terms, except as enforceability may be limited by applicable bankruptcy, insolvency,

reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law); (iv) the execution, delivery and performance of this Amendment, and the performance of the Credit Agreement, as amended hereby, will not violate in any material respect any Requirement of Law applicable to any of the Loan Parties or material Contractual Obligation of any of the Loan Parties, and will not result in, or require, the creation or imposition of any Lien on any of its properties or revenues pursuant to any such Requirement of Law or such material Contractual Obligation, except as permitted by to the Loan Documents; and (v) after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing.

4. If you agree to the terms and conditions set forth herein, please evidence your agreement by executing in the space provided below. This letter amendment shall become effective as of the date first set forth above upon execution of this letter agreement by the Borrower, the Agent and the Lenders. Delivery of an executed counterpart of a signature page of this letter agreement by telecopy or electronically shall be effective as delivery of a manually executed counterpart of this letter agreement.

[Signature Page Follows]

-2-

Except as specifically set forth herein, the Credit Agreement is and shall continue to be in full force and effect and is hereby in all respects ratified and confirmed.

Very truly yours,
ONEWEST BANK, FSB,
as Agent and Lender
By:
Name:	DAVID LIGON
Title:	EXECUTIVE VICE PRESIDENT

Signature Page to Third Amendment to Credit Agreement

Agreed as of the date first written above:

CITY NATIONAL BANK,
as a Lender
By:
Name:	Garen Papazyan
Title:	Senior Vice President

Signature Page to Third Amendment to Credit Agreement

BANK OF MONTREAL,
as a Lender
By:
Name:	Philip Langheim
Title:	Managing Director

Signature Page to Third Amendment to Credit Agreement

PROFESSOR CONNOR’S, INC.,
a Delaware corporation
By:
Name:	Richard A Kassar
Title:	President

Signature Page to Third Amendment to Credit Agreement

Schedule 1.1(a)

Shareholder Guarantors

Guarantor	Amount		%
MidOcean Partners III, L.P.	$	19,543,446.05		32.57	%
MidOcean Partners III-A, L.P.	$	10,390,074.58		17.32	%
MidOcean Partners III-D, L.P	$	1,666,479.37		2.78	%
Mid Ocean Sub-Total	$	31,600,000		52.67	%
Dick Kassar	$	700,000		1.17	%
Richard Thompson	$	300,000		0.50	%
Management Sub-Total	$	1,000,000		1.67	%
Richard and Suzanne Kayne Living Trust u/t/d 1/14/99	$	7,548,425		12.58	%
Norris Trust dtd 6/18/02	$	4,116,595		6.86	%
Michael Targoff	$	2,060,693		3.43	%
Armstrong Trust u/t/d 9/14/2000	$	2,100,000		3.50	%
David J. Shladovsky	$	1,500,000		2.50	%
Mohn Family Trust	$	1,338,044		2.23	%
James Stern	$	1,331,669		2.22	%
Peter Neuwirth Trust dtd 12/9/91	$	993,084		1.66	%
Douglas Hampson Revocable Living Trust (2006)	$	829,170		1.38	%
James R. Wilcox	$	820,950		1.37	%
Patricia Neuwirth Trust dtd 2/5/91	$	738,375		1.23	%
David L. Mahoney and Winnifred C. Ellis 1998 Trust dtd 6/25/98	$	629,115		1.05	%
Jeffrey P. Hughes	$	532,782		0.89	%
The Lieberthal Trust dtd 3/23/99	$	494,412		0.82	%
Howard & Marcie Zelikow Living Trust dtd 5/30/07	$	457,622		0.76	%
Rudnick Living Trust (1999 Restatement)	$	375,000		0.63	%
William A. Goldstein	$	225,561		0.38	%
Joseph E. Parzick	$	210,045		0.35	%
Lawrence S. Coben	$	184,365		0.31	%
Levine-Zacharius Living Trust dtd 11/17/1989	$	183,681		0.31	%
Douglas A. & Lori A. Schur Family Trust dtd 5/1/97	$	168,641		0.28	%
Sasqua Fields Partners, LLC	$	100,000		0.17	%
Silvers Living Trust dtd 2/11/04	$	162,500		0.27	%
Levine Family Investment, LP	$	100,137		0.17	%
Marilyn S. Moscrip	$	90,392		0.15	%
Scott Racine	$	59,903		0.10	%
Walters Family Trust dtd 8/25/05	$	34,871		0.06	%
Lynn Horn	$	13,968		0.02	%
Freshpet Investors Sub-total	$	27,400,000		45.66	%
Total All Guarantees	$	60,000,000		100.00	%

Schedule 1.1(a)

EX-10.5

Exhibit 10.5

AMENDED AND RESTATED

LOAN AND SECURITY AGREEMENT

by and between

PROFESSOR CONNOR’S, INC.

as Borrower,

and

CITY NATIONAL BANK

as Lender

Dated as of December 23, 2010

TABLE OF CONTENTS

		Page
1. DEFINITIONS AND CONSTRUCTION			1
1.1	Definitions		1
1.2	Accounting Terms		17
1.3	Code		17
1.4	Construction		17
1.5	Schedules and Exhibits		18
2. LOAN AND TERMS OF PAYMENT			18
2.1	Revolver Advances		18
2.2	Term Loans		18
2.3	Borrowing Procedures and Settlements		18
2.4	Payments		18
2.5	[Intentionally Omitted]		20
2.6	Interest Rates: Rates, Payments, and Calculations		20
2.7	Cash Management		21
2.8	Crediting Payments		22
2.9	Designated Account		22
2.10	Maintenance of Loan Account; Statements of Obligations		22
2.11	Fees		22
2.12	[Intentionally Omitted]		23
2.13	LIBOR Option		23
2.14	Capital Requirements		25
3. CONDITIONS; TERM OF AGREEMENT			25
3.1	Conditions Precedent to the Initial Extension of Credit		25
3.2	Term		26
3.3	Effective of Termination		27
3.4	Early Termination by Borrower		27
4. CREATION OF SECURITY INTEREST			27
4.1	Grant of Security Interest		27
4.2	Negotiable Collateral		27
4.3	Collection of Accounts, General Intangibles, and Negotiable Collateral		27
4.4	Filing of Financing Statements; Commercial Tort Claims; Delivery of Additional Documentation Required		27
4.5	Power of Attorney		28

-i-

TABLE OF CONTENTS

(continued)

		Page
4.6	Right to Inspect		29
4.7	Control Agreements		29
5. REPRESENTATIONS AND WARRANTIES			29
5.1	No Encumbrances		29
5.2	[Intentionally Omitted]		29
5.3	[Intentionally Omitted]		29
5.4	Equipment		29
5.5	Location of Inventory and Equipment		29
5.6	Inventory Records		29
5.7	State of Incorporation; Location of Chief Executive Office; Organizational Identification Number; Commercial Tort Claims		30
5.8	Due Organization and Qualification; Subsidiaries		30
5.9	Due Authorization; No Conflict		30
5.10	Litigation		31
5.11	No Material Adverse Change		31
5.12	Fraudulent Transfer		31
5.13	Employee Benefits		31
5.14	Environmental Condition		31
5.15	Brokerage Fees		32
5.16	Intellectual Property		32
5.17	Leases		32
5.18	Deposit Accounts and Securities Accounts		32
5.19	Complete Disclosure		32
5.20	Indebtedness		32
6. AFFIRMATIVE COVENANTS			33
6.1	Accounting System		33
6.2	Collateral Reporting		33
6.3	Financial Statements, Reports, Certificates		33
6.4	Guarantor Reports		34
6.5	Maintenance of Properties		34
6.6	Taxes		34
6.7	Insurance		35
6.8	Location of Inventory and Equipment		35

-ii-

TABLE OF CONTENTS

(continued)

		Page
6.9	Compliance with Laws		35
6.10	Leases		36
6.11	Existence		36
6.12	Environmental		36
6.13	Disclosure Updates		36
6.14	Formation of Subsidiaries		36
6.15	Canadian Subsidiary		37
7. NEGATIVE COVENANTS			37
7.1	Indebtedness		37
7.2	Liens		38
7.3	Restrictions on Fundamental Changes		38
7.4	Disposal of Assets		38
7.5	Change Name		38
7.6	Nature of Business		38
7.7	Prepayments and Amendments		38
7.8	Change of Control		39
7.9	Consignments		39
7.10	Distributions		39
7.11	Accounting Methods		39
7.12	Investments		39
7.13	Transactions with Affiliates		39
7.14	Suspension		39
7.15	Use of Proceeds		40
7.16	Inventory and Equipment with Bailees		40
7.17	Financial Covenants		40
8. EVENTS OF DEFAULT			41
9. LENDER’S RIGHTS AND REMEDIES			43
9.1	Rights and Remedies		43
9.2	Remedies Cumulative		44
10. TAXES AND EXPENSES			44
11. WAIVERS; INDEMNIFICATION			45
11.1	Demand; Protest		45
11.2	Lender’s Liability for Borrower Collateral		45
11.3	Indemnification		45

-iii-

TABLE OF CONTENTS

(continued)

		Page
12. NOTICES			45
13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER			46
14. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS			47
14.1	Assignments and Participations		47
14.2	Successors		48
15. AMENDMENTS; WAIVERS			48
15.1	Amendments and Waivers		48
15.2	No Waivers; Cumulative Remedies		49
16. GENERAL PROVISIONS			49
16.1	Effectiveness		49
16.2	Section Headings		49
16.3	Interpretation		49
16.4	Severability of Provisions		49
16.5	Withholding Taxes		49
16.6	Counterparts; Electronic Execution		50
16.7	Revival and Reinstatement of Obligations		50
16.8	Confidentiality		51
16.9	Integration		51

-iv-

EXHIBITS AND SCHEDULES

Exhibit C-1	Form of Compliance Certificate
Exhibit L-1	Form of LIBOR Notice
Exhibit N-1	Form of Notice of Borrowing
Schedule D-1	Designated Account
Schedule E-1	Designated Events of Default
Schedule L-1	Lender’s Account
Schedule P-1	Permitted Liens
Schedule P-2	Permitted Holders
Schedule R-1	Real Property Collateral
Schedule 2.7(a)	Cash Management Banks
Schedule 5.5	Locations of Inventory and Equipment
Schedule 5.7(a)	States of Organization
Schedule 5.7(b)	Chief Executive Offices
Schedule 5.7(c)	Organizational Identification Numbers
Schedule 5.7(d)	Commercial Tort Claims
Schedule 5.8(b)	Capitalization of Borrower
Schedule 5.8(c)	Capitalization of Borrower’s Subsidiaries
Schedule 5.10	Litigation
Schedule 5.14	Environmental Matters
Schedule 5.16	Intellectual Property
Schedule 5.18	Deposit Accounts and Securities Accounts
Schedule 5.20	Permitted Indebtedness

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

THIS AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Agreement”), is entered into as of December 23, 2010, by and between CITY NATIONAL BANK, a national banking association (“Lender”) and PROFESSOR CONNOR’S, INC., a Delaware corporation (“Borrower”).

WHEREAS, Borrower and Lender are parties to that certain Loan and Security Agreement, dated as of October 5, 2007, as amended by that certain Amendment Number One to Loan and Security Agreement and Waiver, dated as of March 31, 2008, as further amended by that certain Amendment Number Two to Loan and Security Agreement and Waiver, dated as of October 20, 2008, as further amended by that certain Amendment Number Three to Loan and Security Agreement and Waiver, dated as of March 26, 2009, as further amended by that certain Amendment Number Four to Loan and Security Agreement and Waiver, dated as of March 15, 2010, and as further amended by that certain Amendment Number Five to Loan and Security Agreement and Waiver, dated as of May 11, 2010 (as so amended, and as otherwise amended, restated, supplemented, or otherwise modified from time to time, the “Original Loan Agreement”);

WHEREAS, Borrower has informed Lender that the Events of Default set forth on Schedule E-1 have occurred and are continuing under the Original Loan Agreement (such Events of Default, together with any other Events of Default that occurred prior to the Restatement Effective Date and which, if this Agreement had been in effect on the date when such Event of Default occurred, would not have constituted an Event of Default under this Agreement, the “Designated Event of Default”);

WHEREAS, Borrower has requested that Lender (a) waive the Designated Events of Default and (b) amend and restate the terms of the Original Loan Agreement in accordance with the terms of this Agreement;

WHEREAS, subject to the terms and conditions of this Agreement, Lender is willing to so waive the Designated Events of Default and so amend and restate (but not extinguish) the Original Loan Agreement;

NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree to amend and restate the Original Loan Agreement as follows:

1. DEFINITIONS AND CONSTRUCTION.

1.1 Definitions. As used in this Agreement, the following terms shall have the following definitions:

“Account” means an account (as that term is defined in the Code).

“Account Debtor” means any Person who is obligated on an Account, chattel paper, or a General Intangible.

“Acquisition” means (a) the purchase or other acquisition by a Person or its Subsidiaries of all or substantially all of the assets of (or any division or business line of) any other Person, or (b) the purchase or other acquisition (whether by means of a merger, consolidation, or otherwise) by a Person or its Subsidiaries of all or substantially all of the Stock of any other Person.

“Additional Documents” has the meaning set forth in Section 4.4(c).

“Adjusted EBITDA” means, with respect to any fiscal period, Borrower’s and its Subsidiaries’ consolidated gross revenue, minus the cost of goods sold, minus selling, general, and administrative expenses (but excluding: (a) any costs associated with the installation of refrigerators in new locations and marketing expenses incurred in connection with the introduction of new locations, (b) all non-cash expenses or losses, including any depreciation and amortization expense, and (c) other non-recurring fees, charges and other expenses that are (i) incurred on or before the Closing Date in connection with this Agreement and the Loan Documents, or (ii) have been approved by Lender, such approval not to be unreasonably withheld.

“Advances” has the meaning set forth in Section 2.1.

“Affiliate” means, as applied to any Person, any other Person who, directly or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. For purposes of this definition, “control” means the possession, directly or indirectly through one or more intermediaries, of the power to direct the management and policies of a Person, whether through the ownership of Stock, by contract, or otherwise; provided, however, that, for purposes of Section 7.13 hereof: (a) any Person which owns directly or indirectly 10% or more of the Stock having ordinary voting power for the election of directors or other members of the governing body of a Person or 10% or more of the partnership or other ownership interests of a Person (other than as a limited partner of such Person) shall be deemed an Affiliate of such Person, (b) each director (or comparable manager) of a Person shall be deemed to be an Affiliate of such Person, and (c) each partnership or joint venture in which a Person is a partner or joint venturer shall be deemed an Affiliate of such Person.

“Agreement” has the meaning set forth in the preamble hereto.

“Annualized Adjusted EBITDA” means, for the purposes of Section 3.4 hereof, Borrower’s Adjusted EBITDA for the six month period ending November 30, 2012 times two (2.0).

“Applicable Cross-Default Amount” means $1,000,000; provided, that if at any time Permitted Holders are no longer obligated to make an equity investment in Borrower in an aggregate amount that is not less than pursuant to the terms of the MidOcean Equity Documents, such amount should at such time be reduced to $500,000.

“Assignee” has the meaning set forth in Section 14.1(a).

“Authorized Person” means any officer or employee of Borrower.

“Bankruptcy Code” means title 11 of the United States Code, as in effect from time to time.

“Base LIBOR Rate” means the rate per annum, determined by Lender in accordance with its customary procedures, and utilizing such electronic or other quotation sources as it considers appropriate (rounded upwards, if necessary, to the next 1/100%), to be the rate at which Dollar deposits (for delivery on the first day of the requested Interest Period) are offered to major banks in the London interbank market 2 Business Days prior to the commencement of the requested Interest Period, for a term and in an amount comparable to the Interest Period and the amount of the LIBOR Rate Loan requested (whether as an initial LIBOR Rate Loan or as a continuation of a LIBOR Rate Loan or as a conversion of a Base Rate Loan to a LIBOR Rate Loan) by Borrower in accordance with this Agreement, which determination shall be conclusive in the absence of manifest error.

“Base Rate” means, the rate of interest publicly quoted, from time to time, by The Wall Street Journal as the “base rate on corporate loans posted by at least 75% of the nation’s 30 largest banks” (or, if The Wall Street Journal ceases quoting a base rate of the type described, the highest per annum rate of interest published by the Federal Reserve Board in Federal Reserve statistical release H.15 (519) entitled “Selected Interest Rates” as the bank prime loan rate or its equivalent).

2

“Base Rate Loan” means the portion of the Advances that bears interest at a rate determined by reference to the Base Rate.

“Base Rate Margin” means 6.00 percentage points.

“Benefit Plan” means a “defined benefit plan” (as defined in Section 3(35) of ERISA) for which Borrower or any Subsidiary or ERISA Affiliate of Borrower has been an “employer” (as defined in Section 3(5) of ERISA) within the past six years.

“Board of Directors” means the board of directors (or comparable managers) of Borrower or any committee thereof duly authorized to act on behalf of the board of directors (or comparable managers).

“Books” means all of Borrower’s and its Subsidiaries’ now owned or hereafter acquired books and records (including all of their Records indicating, summarizing, or evidencing their assets (including the Collateral) or liabilities, all of Borrower’s and its Subsidiaries’ Records relating to their business operations or financial condition, and all of their goods or General Intangibles related to such information).

“Borrower” has the meaning set forth in the preamble to this Agreement.

“Borrower Collateral” means all of Borrower’s now owned or hereafter acquired right, title, and interest in and to each of the following:

(a) all of its Accounts,

(b) all of its Books,

(c) all of its commercial tort claims described on Schedule 5.7(d),

(d) all of its Deposit Accounts,

(e) all of its Equipment,

(f) all of its General Intangibles,

(g) all of its Inventory,

(h) all of its Investment Property (including all of its securities and Securities Accounts),

(i) all of its Negotiable Collateral,

(j) all of its Supporting Obligations,

(k) money or other assets of Borrower that now or hereafter come into the possession, custody, or control of the Lender, and

(l) the proceeds and products, whether tangible or intangible, of any of the foregoing, including proceeds of insurance covering any or all of the foregoing, and any and all Accounts, Books, Deposit Accounts, Equipment, General Intangibles, Inventory, Investment Property, Negotiable Collateral, Real Property, Supporting Obligations, money, or other tangible or intangible property resulting from the sale, exchange, collection, or other disposition of any of the foregoing, or any portion thereof or interest therein, and the proceeds thereof.

3

“Borrowing” means a borrowing hereunder consisting of Advances.

“Business Day” means any day that is not a Saturday, Sunday, or other day on which banks are authorized or required to close in the state of California, except that, if a determination of a Business Day shall relate to a LIBOR Rate Loan, the term “Business Day” also shall exclude any day on which banks are closed for dealings in Dollar deposits in the London interbank market.

“Canadian Subsidiary” means Professor Connors Canada, Inc., a company organized under the laws of the province of Ontario.

“Capitalized Lease Obligation” means that portion of the obligations under a Capital Lease that is required to be capitalized in accordance with GAAP.

“Capital Lease” means a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP. Notwithstanding anything else set forth herein, any lease that was or would have been treated as an operating lease under GAAP as in effect on the Restatement Effective Date that would be treated as a capital lease solely as a result of a change in GAAP after the Restatement Effective Date shall always be treated as an operating lease for all purposes and at all times under this Agreement.

“Cash Equivalents” means (a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within 1 year from the date of acquisition thereof, (b) marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within 1 year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either Standard & Poor’s Rating Group (“S&P”) or Moody’s Investor Service, Inc. (“Moody’s”), (c) commercial paper maturing no more than 270 days from the date of creation thereof and, at the time of acquisition, having a rating of at least A-1 from S&P or at least P-1 from Moody’s, (d) certificates of deposit or bankers’ acceptances maturing within 1 year from the date of acquisition thereof issued by any bank organized under the laws of the United States or any state thereof having at the date of acquisition thereof combined capital and surplus of not less than $250,000,000, (e) Deposit Accounts maintained with (i) any bank that satisfies the criteria described in clause (d) above, or (ii) any other bank organized under the laws of the United States or any state thereof so long as the amount maintained with any such other bank is less than or equal to $100,000 and is insured by the Federal Deposit Insurance Corporation, and (f) Investments in money market funds substantially all of whose assets are invested in the types of assets described in clauses (a) through (e) above.

“Cash Management Account” has the meaning set forth in Section 2.7(a).

“Cash Management Agreements” means those certain cash management agreements, in form and substance reasonably satisfactory to Lender, each of which is among Borrower or one of its Subsidiaries, Lender, and one of the Cash Management Banks.

“Cash Management Bank” has the meaning set forth in Section 2.7(a).

“CFC” means a controlled foreign corporation (as that term is defined in the IRC).

“Change of Control” means that (a) Permitted Holders fail to own and control, directly or indirectly, 50.1% or more, of the Stock of Borrower having the right to vote for the election of members of the Board of Directors, (b) Freshpet Investors, LLC fail to own and control, directly or indirectly, 20% or more, of the Stock of Borrower having the right to vote for the election of members of the Board of Directors, or (c) a majority of the members of the Board of Directors do not constitute Continuing Directors.

4

“Chillers” means a refrigerated unit out of which Borrower’s products are sold.

“Code” means the California Uniform Commercial Code, as in effect from time to time; provided, however, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection, priority, or remedies with respect to Lender’s Lien on any Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction other than the State of California, the term “Code” shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies.

“Collateral” means all assets and interests in assets and proceeds thereof now owned or hereafter acquired by Borrower or its Subsidiaries in or upon which a Lien is granted under any of the Loan Documents.

“Collateral Access Agreement” means a landlord waiver, bailee letter, or acknowledgement agreement of any lessor, warehouseman, processor, consignee, or other Person in possession of, having a Lien upon, or having rights or interests in Borrower’s or its Subsidiaries’ Books, Equipment, or Inventory, in each case, in form and substance reasonably satisfactory to Lender.

“Collections” means all cash, checks, notes, instruments, and other items of payment (including insurance proceeds, proceeds of cash sales, rental proceeds, and tax refunds).

“Commercial Tort Claim Assignment” has the meaning set forth in Section 4.4(b).

“Compliance Certificate” means a certificate substantially in the form of Exhibit C-1 delivered by the chief financial officer of Borrower to Lender.

“Consolidated Funded Indebtedness” means, with respect to any Person at any date, the remainder of (a) all Indebtedness for borrowed money of such Person, determined on a consolidated basis in accordance with GAAP (other than Subordinated Debt and Permitted Preferred Stock), including, in any event, but without duplication, with respect to Borrower and its Subsidiaries, the Advances, and the amount of their Capitalized Lease Obligations, in each case exclusive of Indebtedness owed by one Loan Party to another Loan Party and any Indebtedness in respect of any of the foregoing less (b) all Qualified Cash of the Loan Parties at such date, to extent that the amount thereof is in excess of $500,000 at such date.

“Continuing Director” means (a) any member of the Board of Directors who was a director (or comparable manager) of Borrower on the Restatement Effective Date, and (b) any individual who becomes a member of the Board of Directors after the Restatement Effective Date if such individual was appointed or nominated for election to the Board of Directors by a majority of the Continuing Directors, but excluding any such individual originally proposed for election in opposition to the Board of Directors in office at the Restatement Effective Date in an actual or threatened election contest relating to the election of the directors (or comparable managers) of Borrower and whose initial assumption of office resulted from such contest or the settlement thereof.

“Control Agreement” means a control agreement, in form and substance reasonably satisfactory to Lender, executed and delivered by Borrower or one of its Subsidiaries, Lender, and the applicable securities intermediary (with respect to a Securities Account) or bank (with respect to a Deposit Account).

“Copyright Security Agreement” means a copyright security agreement executed and delivered by Borrower and Lender, the form and substance of which is reasonably satisfactory to Lender.

5

“Daily Balance” means, as of any date of determination and with respect to any Obligation, the amount of such Obligation owed at the end of such day.

“Default” means an event, condition, or default that, with the giving of notice, the passage of time, or both, would be an Event of Default.

“Deposit Account” means any deposit account (as that term is defined in the Code).

“Designated Account” means the Deposit Account of Borrower identified on Schedule D-1.

“Designated Account Bank” has the meaning ascribed thereto on Schedule D-1.

“Designated Events of Default” has the meaning ascribed thereto in the recitals to this Agreement.

“Disposition” means any transaction, or series of related transactions, pursuant to which any Person or any of its Subsidiaries sells, assigns, transfers or otherwise disposes of any property or assets (whether now owned or hereafter acquired) to any other Person, in each case, whether or not the consideration therefor consists of cash, securities or other assets owned by the acquiring Person, whether voluntary or involuntary and including any casualty losses or condemnations or other loss or destruction of any property of Borrower or any of its Subsidiaries.

“Dollars” or “$” means United States dollars.

“Eligible Equipment” means (a) the purchase of refrigerators, and (b) the purchase of Equipment to be used at new or existing production facilities of Borrower.

“Environmental Actions” means any complaint, summons, citation, notice, directive, order, claim, litigation, investigation, judicial or administrative proceeding, judgment, letter, or other communication from any Governmental Authority, or any third party involving violations of Environmental Laws or releases of Hazardous Materials from (a) any assets, properties, or businesses of Borrower, its Subsidiaries, or any of their predecessors in interest, (b) from adjoining properties or businesses, or (c) from or onto any facilities which received Hazardous Materials generated by Borrower, its Subsidiaries, or any of their predecessors in interest.

“Environmental Law” means any applicable federal, state, provincial, foreign or local statute, law, rule, regulation, ordinance, code, binding and enforceable guideline, binding and enforceable written policy, or rule of common law now or hereafter in effect and in each case as amended, or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, in each case, to the extent binding on Borrower or its Subsidiaries, relating to the environment, the effect of the environment on employee health, or Hazardous Materials, including the Comprehensive Environmental Response Compensation and Liability Act, 42 USC § 9601 et seq.; the Resource Conservation and Recovery Act, 42 USC § 6901 et seq.; the Federal Water Pollution Control Act, 33 USC § 1251 et seq.; the Toxic Substances Control Act, 15 USC § 2601 et seq.; the Clean Air Act, 42 USC § 7401 et seq.; the Safe Drinking Water Act, 42 USC § 3803 et seq.; the Oil Pollution Act of 1990, 33 USC § 2701 et seq.; the Emergency Planning and the Community Right-to-Know Act of 1986, 42 USC § 11001 et seq.; the Hazardous Material Transportation Act, 49 USC § 1801 et seq.; and the Occupational Safety and Health Act, 29 USC §651 et seq. (to the extent it regulates occupational exposure to Hazardous Materials); any state and local or foreign counterparts or equivalents, in each case as amended from time to time.

“Environmental Liabilities and Costs” means all liabilities, monetary obligations, losses, damages, punitive damages, consequential damages, treble damages, costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts, or consultants, and costs of investigation and

6

feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand, or Remedial Action required, by any Governmental Authority or any third party, and which relate to any Environmental Action.

“Environmental Lien” means any Lien in favor of any Governmental Authority for Environmental Liabilities and Costs.

“Equipment” means equipment (as that term is defined in the Code) and includes machinery, machine tools, motors, furniture, furnishings, fixtures, vehicles (including motor vehicles), computer hardware, tools, parts, and goods (other than consumer goods, farm products, or Inventory), wherever located, including all attachments, accessories, accessions, replacements, substitutions, additions, and improvements to any of the foregoing.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended, and any successor statute thereto.

“ERISA Affiliate” means (a) any Person subject to ERISA whose employees are treated as employed by the same employer as the employees of Borrower or its Subsidiaries under IRC Section 414(b), (b) any trade or business subject to ERISA whose employees are treated as employed by the same employer as the employees of Borrower or its Subsidiaries under IRC Section 414(c), (c) solely for purposes of Section 302 of ERISA and Section 412 of the IRC, any organization subject to ERISA that is a member of an affiliated service group of which Borrower or any of its Subsidiaries is a member under IRC Section 414(m), or (d) solely for purposes of Section 302 of ERISA and Section 412 of the IRC, any Person subject to ERISA that is a party to an arrangement with Borrower or any of its Subsidiaries and whose employees are aggregated with the employees of Borrower or its Subsidiaries under IRC Section 414(o).

“Event of Default” has the meaning set forth in Section 8.

“Exchange Act” means the Securities Exchange Act of 1934, as in effect from time to time.

“Existing Installed Stores” means the number of Installed Stores as of December 31, 2010.

“Existing Term Loan” means the term loans made under the Original Loan Agreement in an outstanding principal balance as of the Restatement Effective Date of $8,750,000.

“Fee Letter” means that certain amended and restated fee letter, dated as of even date herewith, between Borrower and Lender, in form and substance reasonably satisfactory to Lender.

“Funding Date” means the date on which a Borrowing occurs.

“Funding Losses” has the meaning set forth in Section 2.13(b)(ii).

“GAAP” means generally accepted accounting principles as in effect from time to time in the United States, consistently applied.

“General Intangibles” means general intangibles (as that term is defined in the Code), including payment intangibles, contract rights, rights to payment, rights arising under common law, statutes, or regulations, choses or things in action, goodwill, patents, trade names, trade secrets, trademarks, servicemarks, copyrights, blueprints, drawings, purchase orders, customer lists, monies due or recoverable from pension funds, route lists, rights to payment and other rights under any royalty or licensing agreements, infringement claims, computer programs, information contained on computer disks or tapes, software, literature, reports, catalogs, insurance premium rebates, tax refunds, and tax refund claims, and any other personal property other than Accounts, Deposit Accounts, goods, Investment Property, and Negotiable Collateral.

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“Governing Documents” means, with respect to any Person, the certificate or articles of incorporation, by-laws, or other organizational documents of such Person.

“Governmental Authority” means any federal, state, local, or other governmental or administrative body, instrumentality, board, department, or agency or any court, tribunal, administrative hearing body, arbitration panel, commission, or other similar dispute-resolving panel or body.

“Guarantors” means (a) each existing and future Subsidiary of Borrower, and “Guarantor” means any one of them.

“Guarantor Security Agreement” means one or more security agreements executed and delivered by each Guarantor (if any) in favor of Lender, in each case, in form and substance reasonably satisfactory to Lender.

“Guaranty” means that certain general continuing guaranty executed and delivered by each Guarantor (if any) in favor of Lender, in form and substance reasonably satisfactory to Lender.

“Hazardous Materials” means (a) substances that are defined or listed in, or otherwise classified pursuant to, any applicable laws or regulations as “hazardous substances,” “hazardous materials,” “hazardous wastes,” “toxic substances,” or any other formulation intended to define, list, or classify substances by reason of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, reproductive toxicity, or “EP toxicity”, (b) oil, petroleum, or petroleum derived substances, natural gas, natural gas liquids, synthetic gas, drilling fluids, produced waters, and other wastes associated with the exploration, development, or production of crude oil, natural gas, or geothermal resources, (c) any flammable substances or explosives or any radioactive materials, and (d) asbestos in any form or electrical equipment that contains any oil or dielectric fluid containing levels of polychlorinated biphenyls in excess of 50 parts per million.

“Hedge Agreement” means any and all agreements or documents now existing or hereafter entered into by Borrower or any of its Subsidiaries that provide for an interest rate, credit, commodity or equity swap, cap, floor, collar, forward foreign exchange transaction, currency swap, cross currency rate swap, currency option, or any combination of, or option with respect to, these or similar transactions, for the purpose of hedging Borrower’s or any of its Subsidiaries’ exposure to fluctuations in interest or exchange rates, loan, credit exchange, security, or currency valuations or commodity prices.

“Hedge Obligations” means any and all obligations or liabilities, whether absolute or contingent, due or to become due, now existing or hereafter arising, of a Borrower or its Subsidiaries arising under, owing pursuant to, or existing in respect of any Hedge Agreements.

“Indebtedness” means (a) all obligations for borrowed money (and Prohibited Preferred Stock), (b) all obligations evidenced by bonds, debentures, notes, or other similar instruments and all reimbursement or other obligations in respect of letters of credit, bankers acceptances, interest rate swaps, or other financial products, (c) all obligations as a lessee under Capital Leases, (d) all obligations or liabilities of others secured by a Lien on any asset of a Person or its Subsidiaries, irrespective of whether such obligation or liability is assumed, (e) all obligations to pay the deferred purchase price of assets (other than trade payables, deferred rent, taxes or compensation incurred in the ordinary course of business and repayable in accordance with customary trade practices), (f) all Hedge Obligations, and (g) any obligation guaranteeing or intended to guarantee (whether directly or indirectly guaranteed, endorsed, co-made, discounted, or sold with recourse) any obligation of any other Person that constitutes Indebtedness under any of clauses (a) through (f) above.

“Indemnified Liabilities” has the meaning set forth in Section 11.3.

“Indemnified Person” has the meaning set forth in Section 11.3.

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“Insolvency Proceeding” means any proceeding commenced by or against any Person under any provision of the Bankruptcy Code or under any other state or federal bankruptcy or insolvency law, assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or proceedings seeking reorganization, arrangement, or other similar relief.

“Installed Store” means a store or other place of business not owned, leased or operated by a Loan Party or any of its Affiliates in which Borrower’s products are maintained and sold.

“Intercompany Subordination Agreement” means a subordination agreement executed and delivered by Borrower and each of its Subsidiaries (if any) and Lender, the form and substance of which is reasonably satisfactory to Lender.

“Interest Expense” means, for any period, the aggregate of the interest expense of Borrower and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.

“Interest Period” means, with respect to each LIBOR Rate Loan, a period commencing on the date of the making of such LIBOR Rate Loan (or the continuation of a LIBOR Rate Loan or the conversion of a Base Rate Loan to a LIBOR Rate Loan) and ending 1, 2, 3 or 6 months thereafter; provided, however, that (a) if any Interest Period would end on a day that is not a Business Day, such Interest Period shall be extended (subject to clauses (c)-(e) below) to the next succeeding Business Day, (b) interest shall accrue at the applicable rate based upon the LIBOR Rate from and including the first day of each Interest Period to, but excluding, the day on which any Interest Period expires, (c) any Interest Period that would end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day, (d) with respect to an Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period), the Interest Period shall end on the last Business Day of the calendar month that is 1, 2, or 3 months after the date on which the Interest Period began, as applicable, and (e) Borrower may not elect an Interest Period which will end after the Maturity Date.

“Inventory” means inventory (as that term is defined in the Code).

“Investment” means, with respect to any Person, any investment by such Person in any other Person (including Affiliates) in the form of loans, guarantees, advances, or capital contributions (excluding (a) commission, travel, and similar advances to officers and employees of such Person made in the ordinary course of business, and (b) bona fide Accounts arising in the ordinary course of business consistent with past practice), purchases or other acquisitions of Indebtedness, Stock, or all or substantially all of the assets of such other Person (or of any division or business line of such other Person), and any other items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP.

“Investment Property” means investment property (as that term is defined in the Code).

“Investor Rights Agreement” means that certain Stockholders Agreement dated as of October 25, 2006 by and among the Borrower and the holders of its Stock.

“IRC” means the Internal Revenue Code of 1986, as in effect from time to time.

“Lender” has the meaning set forth in the preamble to this Agreement.

“Lender Expenses” means all (a) documented costs or expenses (including taxes, and insurance premiums) required to be paid by Borrower or its Subsidiaries under any of the Loan Documents that are paid, advanced, or incurred by Lender, (b) fees or charges paid or incurred by Lender in connection with Lender’s transactions with Borrower or its Subsidiaries, including, fees or charges for photocopying,

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notarization, couriers and messengers, telecommunication, public record searches (including tax lien, litigation, and UCC searches and including searches with the patent and trademark office, the copyright office, or the department of motor vehicles), filing, recording, publication, appraisal (including periodic collateral appraisals or business valuations to the extent of the fees and charges (and up to the amount of any limitation) contained in this Agreement), real estate surveys, real estate title policies and endorsements, and environmental audits, (c) costs and expenses incurred by Lender in the disbursement of funds to Borrower (by wire transfer or otherwise), (d) charges paid or incurred by Lender resulting from the dishonor of checks, (e) reasonable costs and expenses paid or incurred by Lender to correct any default or enforce any provision of the Loan Documents, or in gaining possession of, maintaining, handling, preserving, storing, shipping, selling, preparing for sale, or advertising to sell the Collateral, or any portion thereof, irrespective of whether a sale is consummated, (f) audit fees and expenses of Lender related to audit examinations of the Books to the extent of the fees and charges (and up to the amount of any limitation) contained in this Agreement, (g) reasonable costs and expenses of third party claims or any other suit paid or incurred by Lender in enforcing or defending the Loan Documents or in connection with the transactions contemplated by the Loan Documents or Lender’s relationship with Borrower or any of its Subsidiaries, (h) Lender’s reasonable costs and expenses (including attorneys fees) incurred in advising, structuring, drafting, reviewing, administering, syndicating, or amending the Loan Documents, and (i) Lender’s reasonable costs and expenses (including attorneys, accountants, consultants, and other advisors fees and expenses) incurred in terminating, enforcing (including attorneys, accountants, consultants, and other advisors fees and expenses incurred in connection with a “workout,” a “restructuring,” or an Insolvency Proceeding concerning Borrower or its Subsidiaries or in exercising rights or remedies under the Loan Documents), or defending the Loan Documents, irrespective of whether suit is brought, or in taking any Remedial Action concerning the Collateral.

“Lender-Related Person” means Lender, together with its Affiliates, officers, directors, employees, attorneys, and agents.

“Lender’s Account” means the account identified in Schedule L-1.

“Lender’s Liens” means the Liens granted by Borrower and its Subsidiaries to Lender under this Agreement or the other Loan Documents.

“Leverage Ratio” means, as of any date of determination, the ratio of (a) Consolidated Funded Indebtedness of Borrower and its Subsidiaries as of such date of determination to (b) TTM EBITDA of Borrower and its Subsidiaries as of such date of determination.

“LIBOR Deadline” has the meaning set forth in Section 2.13(b)(i).

“LIBOR Notice” means a written notice in the form of Exhibit L-1.

“LIBOR Option” has the meaning set forth in Section 2.13(a).

“LIBOR Rate” means, for each Interest Period for each LIBOR Rate Loan, the rate per annum determined by Lender (rounded upwards, if necessary, to the next 1/100%) by dividing (a) the Base LIBOR Rate for such Interest Period, by (b) 100% minus the Reserve Percentage. The LIBOR Rate shall be adjusted on and as of the effective day of any change in the Reserve Percentage.

“LIBOR Rate Loan” means each portion of an Advance that bears interest at a rate determined by reference to the LIBOR Rate.

“LIBOR Rate Margin” means 8.00 percentage points.

“Lien” means any interest in an asset securing an obligation owed to, or a claim by, any Person other than the owner of the asset, irrespective of whether (a) such interest is based on the common law,

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statute, or contract, (b) such interest is recorded or perfected, and (c) such interest is contingent upon the occurrence of some future event or events or the existence of some future circumstance or circumstances. Without limiting the generality of the foregoing, the term “Lien” includes the lien or security interest arising from a mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment, deposit arrangement, security agreement, conditional sale or trust receipt, or from a lease, consignment, or bailment for security purposes and also includes reservations, exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions, leases, and other title exceptions and encumbrances affecting Real Property.

“Loan Account” has the meaning set forth in Section 2.10.

“Loan Documents” means this Agreement, the Cash Management Agreements, the Control Agreements, the Copyright Security Agreement, the Fee Letter, any Guarantor Security Agreement, any Guaranty, any Intercompany Subordination Agreement, the Investor Rights Agreement, any Mortgages, the Patent Security Agreement, the Stock Pledge Agreement, the Trademark Security Agreement, the Warrant Agreement, any note or notes executed by Borrower in connection with this Agreement and payable to Lender, and any other agreement entered into, now or in the future, by Borrower and Lender in connection with either this Agreement or the Original Loan Agreement.

“Loan Parties” means Borrower and each Guarantor, and “Loan Party” means any one of them.

“Material Adverse Change” means (a) a material adverse change in the business, operations, results of operations, assets, liabilities or condition (financial or otherwise) of Borrower and its Subsidiaries, taken as a whole, (b) a material impairment of Borrower’s and its Subsidiaries’ ability to perform their respective obligations under the Loan Documents to which they are parties or of Lender’s ability to enforce the Obligations or realize upon the Collateral, or (c) a material impairment of the enforceability or priority of the Lender’s Liens with respect to the Collateral as a result of an action or failure to act on the part of Borrower or its Subsidiaries.

“Maturity Date” has the meaning set forth in Section 3.4.

“Maximum Revolver Amount” means $10,000,000.

“MidOcean” means (a) Midocean Partners III, L.P. and any fund or investment vehicle that is organized by MidOcean Partners III, L.P. for the purpose of making equity or debt investments in one or more companies and/or (b) is controlled by, or under common control with, MidOcean Partners III, L.P.

“MidOcean Equity Documents” means (a) that certain Amended and Restated Stockholders Agreement dated as of the Restatement Effective Date by and among Borrower, MidOcean, Frespet Investors, LLC, and certain other shareholders of Borrower, (b) the Second Amended and Restated Certificate of Incorporation of Professor Connor’s Inc., and (c) that certain Stock Purchase Agreement dated as of the Restatement Effective Date, by and between Borrower and MidOcean.

“MidOcean Investment” means the equity investment by MidOcean in Borrower on the Restatement Effective Date in an aggregate amount of at least $20,000,000.

“Mortgages” means, individually and collectively, one or more mortgages, deeds of trust, or deeds to secure debt, executed and delivered by Borrower or its Subsidiaries in favor of Lender, in form and substance reasonably satisfactory to Lender, that encumber the Real Property Collateral.

“Negotiable Collateral” means letters of credit, letter of credit rights, instruments, promissory notes, drafts, documents, and chattel paper (including electronic chattel paper and tangible chattel paper).

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“Net Cash Proceeds” means, (i) with respect to any Disposition by any Person or any of its Subsidiaries, the amount of cash received (directly or indirectly) from time to time (whether as initial consideration or through the payment or disposition of deferred consideration) by or on behalf of such Person or such Subsidiary, in connection therewith after deducting therefrom only (A) the amount of any Indebtedness secured by any Permitted Lien on any asset (other than Indebtedness assumed by the purchaser of such asset) which is required to be, and is, repaid in connection with such Disposition (other than Indebtedness under this Agreement), (B) reasonable expenses related thereto incurred by such Person or such Subsidiary in connection therewith, (C) transfer taxes paid to any taxing authorities by such Person or such Subsidiary in connection therewith, and (D) net income taxes to be paid in connection with such Disposition (after taking into account any tax credits or deductions and any tax sharing arrangements) and (ii) with respect to the issuance or incurrence of any Indebtedness by any Person or any of its Subsidiaries, or the sale or issuance by any Person or any of its Subsidiaries of any shares of its Stock, the aggregate amount of cash received (directly or indirectly) from time to time (whether as initial consideration or through the payment or disposition of deferred consideration) by or on behalf of such Person or such Subsidiary in connection therewith, after deducting therefrom only (A) reasonable expenses related thereto incurred by such Person or such Subsidiary in connection therewith, (B) transfer taxes paid by such Person or such Subsidiary in connection therewith and (C) net income taxes to be paid in connection therewith (after taking into account any tax credits or deductions and any tax sharing arrangements); in each case of clause (i) and (ii) to the extent, but only to the extent, that the amounts so deducted are properly attributable to such transaction or to the asset that is the subject thereof.

“Obligations” means all loans, Advances, debts, principal, interest, premiums, liabilities (including all amounts charged to Borrower’s Loan Account pursuant hereto), obligations (including indemnification obligations), fees (including the fees provided for in the Fee Letter), charges, costs, Lender Expenses (including any fees or expenses that, but for the commencement of an Insolvency Proceeding, would have accrued), lease payments, guaranties, covenants, and duties of any kind and description owing by Borrower to Lender pursuant to or evidenced by the Loan Documents and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all interest not paid when due and all Lender Expenses that Borrower is required to pay or reimburse by the Loan Documents, by law, or otherwise, regardless of whether any of the foregoing that accrues after the commencement of an Insolvency Proceeding is allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding. Any reference in this Agreement or in the Loan Documents to the Obligations shall include all extensions, modifications, renewals or alterations thereof, both prior and subsequent to any Insolvency Proceeding.

“Original Closing Date” means October 5, 2007.

“Participant” has the meaning set forth in Section 14.1(d).

“Patent Security Agreement” means a patent security agreement executed and delivered by Borrower and Lender, the form and substance of which is reasonably satisfactory to Lender.

“Permitted Acquisition” means any Acquisition so long as:

(a) no Default or Event of Default shall have occurred and be continuing or would result from the consummation of the proposed Acquisition and the proposed Acquisition is consensual,

(b) Borrower has provided Lender with written confirmation, supported by reasonably detailed calculations, that on a pro forma basis (including pro forma adjustments arising out of events which are directly attributable to such proposed Acquisition, are factually supportable, and are expected to have a continuing impact, in each case, determined as if the combination had been accomplished at the beginning of the relevant period; such eliminations and inclusions to be mutually and reasonably agreed upon by Borrower and Lender) created by adding the historical combined financial statements of Borrower (including the combined financial statements of any other Person or assets that were the subject of a prior Permitted

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Acquisition during the relevant period) to the historical consolidated financial statements of the Person to be acquired (or the historical financial statements related to the assets to be acquired) pursuant to the proposed Acquisition, Borrower and its Subsidiaries would have been in compliance with the financial covenants in Section 7.18 of the Agreement for the 4 fiscal quarter period ended immediately prior to the proposed date of consummation of such proposed Acquisition,

(c) Borrower has provided Lender with its due diligence package relative to the proposed Acquisition, consisting of, to the extent reasonably available, forecasted balance sheets, profit and loss statements, and cash flow statements of the Person or assets to be acquired, together with appropriate supporting details and a statement of underlying assumptions for the 1 year period following the date of the proposed Acquisition, on a quarter by quarter basis),

(d) the assets being acquired or the Person whose Stock is being acquired did not have negative EBITDA during the 12 consecutive month period most recently concluded prior to the date of the proposed Acquisition,

(e) Borrower has provided Lender with written notice of the proposed Acquisition at least 5 Business Days prior to the anticipated closing date of the proposed Acquisition, copies of the acquisition agreement and other material documents relative to the proposed Acquisition, which agreement and documents must be reasonably acceptable to Lender,

(f) the assets being acquired (other than a de minimis amount of assets in relation to Borrower’s and its Subsidiaries’ total assets), or the Person whose Stock is being acquired, are useful in or engaged in, as applicable, the business of Borrower and its Subsidiaries or a business reasonably related thereto,

(g) the assets being acquired (other than a de minimis amount of assets in relation to the assets being acquired) are located within the United States or Canada, or the Person whose Stock is being acquired is organized in a jurisdiction located within the United States or Canada,

(h) the subject assets or Stock, as applicable, are being acquired directly by Borrower or a Subsidiary, and, in connection therewith, such Borrower or Subsidiary shall have provided such documents and instruments as requested are required by Section 6.15 of the Agreement), and

(i) the consideration payable in respect of the proposed Acquisition shall be composed solely of (i) common Stock of Borrower, or (ii) proceeds of equity contributions made to the Borrower by a Permitted Holder for the purpose of funding, in whole or in part, a proposed Acquisition, or (iii) Subordinated Debt.

“Permitted Discretion” means a determination made in the exercise of reasonable (from the perspective of a secured lender) business judgment.

“Permitted Dispositions” means (a) sales or other dispositions of Equipment that is substantially worn, damaged, or obsolete in the ordinary course of business or no longer used or useful, (b) sales of Inventory to buyers in the ordinary course of business, (c) the use or transfer of money or Cash Equivalents in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents, (d) the licensing, on a non-exclusive basis, of patents, trademarks, copyrights, and other intellectual property rights in the ordinary course of business, (e) any Dispositions of any property by any Subsidiary to the Borrower to the extent (i) any resulting Investment constitutes a Permitted Investment, (ii) the foregoing constitutes a distribution permitted pursuant to Section 7.10, or (iii) the foregoing constitutes a transaction permitted by Section 7.3, (f) any Disposition or issuance by the Borrower of its own equity interests to the extent that any such issuance does not result in a Change of Control, (g) any other Disposition of property of Borrower; provided that the aggregate consideration received during any fiscal year of the Borrower for all such

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Dispositions shall not exceed $1,000,000, (h) Dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similar property or (ii) the proceeds of such Disposition are promptly applied to the purchase price of such similar property, (i) Dispositions of accounts receivables in connection with the collection or compromise thereof in the ordinary course of business, (j) the granting of a Permitted Lien, and (k) Dispositions resulting from property loss events or takings and transfers of property that has suffered a property loss event or a taking (constituting a total loss or constructive total loss of such property) upon receipt of the Net Cash Proceeds of such property loss event or taking.

“Permitted Holders” means the Persons identified on Schedule P-2 hereto.

“Permitted Investments” means (a) Investments in cash and Cash Equivalents, (b) Investments in negotiable instruments for collection, (c) advances made in connection with purchases of goods or services in the ordinary course of business, (d) loans and advances to officers, managers, directors and employees of any Loan Party in the ordinary course of business for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary business purposes (including employee payroll advances), (e) Investments resulting from entering into any Hedge Agreements, (f) Investments received in settlement of amounts due to Borrower or any of its Subsidiaries effected in the ordinary course of business or owing to Borrower or any of its Subsidiaries as a result of Insolvency Proceedings involving an Account Debtor or upon the foreclosure or enforcement of any Lien in favor of Borrower or its Subsidiaries, (g) Permitted Acquisitions, (h) Investments by a Loan Party in another Loan Party, (i) other Investments in an aggregate outstanding amount not to exceed $1,000,000 at any time, (j) any Investment owned by a Person at the time such Person is acquired and becomes a Subsidiary pursuant to a Permitted Acquisition; provided that such Investment was not made in connection with or in contemplation of such Permitted Acquisition, (k) any Investments made from casualty insurance proceeds in connection with the replacement, substitution, restoration or repair of assets on account of an insurable event to the extent such assets were covered by casualty insurance maintained by the Borrower or a Subsidiary, (l) Investments consisting of purchases and acquisitions of inventory, supplies, material or equipment, in each such case in the ordinary course of business, and (m) any other Investments (other than an Investment that constitutes an Acquisition) made with the proceeds of equity interests issued by the Borrower to a Permitted Holder. For purposes of covenant compliance, the amount of any Permitted Investment shall be the amount actually invested less cash returns on such Investment.

“Permitted Liens” means (a) Liens held by Lender, (b) Liens for unpaid taxes that either (i) are not yet delinquent, or (ii) do not constitute an Event of Default hereunder and are the subject of Permitted Protests, (c) Liens set forth on Schedule P-1, (d) the interests of lessors under operating leases, (e) purchase money Liens or the interests of lessors under Capital Leases to the extent that such Liens or interests secure Permitted Purchase Money Indebtedness and so long as such Lien attaches only to the asset purchased or acquired and the proceeds thereof, (f) Liens arising by operation of law in favor of warehousemen, landlords, carriers, mechanics, materialmen, laborers, or suppliers, incurred in the ordinary course of business and not in connection with the borrowing of money, and which Liens either (i) are for sums not yet delinquent by more than 30 days, or (ii) are the subject of Permitted Protests, (g) Liens on amounts deposited in connection with obtaining worker’s compensation or other unemployment insurance, (h) Liens on amounts deposited in connection with the making or entering into of bids, tenders, or leases in the ordinary course of business and not in connection with the borrowing of money, (i) Liens on amounts deposited as security for surety or appeal bonds in connection with obtaining such bonds in the ordinary course of business, (j) Liens resulting from any judgment or award that is not an Event of Default hereunder, (k) with respect to any Real Property, easements, rights of way, and zoning restrictions that do not materially interfere with or impair the use or operation thereof and (l) Liens securing Subordinated Debt.

“Permitted Preferred Stock” means and refers to any Preferred Stock issued by the Parent (and not by one or more of its Subsidiaries) that is not Prohibited Preferred Stock.

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“Permitted Protest” means the right of Borrower or any of its Subsidiaries to protest any Lien (other than any Lien that secures the Obligations), taxes (other than payroll taxes or taxes that are the subject of a United States federal tax lien), or rental payment, provided that (a) a reserve with respect to such obligation is established on the Books in such amount as is required under GAAP, (b) any such protest is instituted promptly and prosecuted diligently by Borrower or any of its Subsidiaries, as applicable, in good faith, and (c) Lender is satisfied that, while any such protest is pending, there will be no impairment of the enforceability, validity, or priority of any of the Lender’s Liens.

“Permitted Purchase Money Indebtedness” means, as of any date of determination, Purchase Money Indebtedness that does not constitute Subordinated Debt and that is incurred after the Restatement Effective Date in an aggregate amount outstanding at any one time not in excess of $500,000 plus any Purchase Money Indebtedness used to finance the purchase of Chillers.

“Preferred Stock” means, as applied to the Stock of any Person, the Stock of any class or classes (however designated) that is preferred with respect to the payment of dividends, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of Stock of any other class of such Person.

“Prohibited Preferred Stock” means any Preferred Stock that by its terms is mandatorily redeemable or subject to any other payment obligation (including any obligation to pay dividends, other than dividends of shares of Preferred Stock of the same class and series payable in kind or dividends of shares of common stock) on or before a date that is less than 6 months after the Maturity Date, or, on or before the date that is less than 6 months after the then extant Maturity Date, is redeemable at the option of the holder thereof for cash or assets or securities (other than distributions in kind of shares of Preferred Stock of the same class and series or of shares of common stock).

“Person” means natural persons, corporations, limited liability companies, limited partnerships, general partnerships, limited liability partnerships, joint ventures, trusts, land trusts, business trusts, or other organizations, irrespective of whether they are legal entities, and governments and agencies and political subdivisions thereof.

“Projections” means Borrower’s forecasted (a) balance sheets, (b) profit and loss statements, and (c) cash flow statements, all prepared on a basis consistent with Borrower’s historical financial statements, together with appropriate supporting details and a statement of underlying assumptions.

“Purchase Money Indebtedness” means Indebtedness (other than the Obligations, but including Capitalized Lease Obligations), incurred at the time of, or within 90 days after, the acquisition of any fixed assets for the purpose of financing all or any part of the acquisition cost thereof.

“Qualified Cash” means, as of any date of determination, the amount of unrestricted cash and Cash Equivalents of the Loan Parties that is in Deposit Accounts or in Securities Accounts, or any combination thereof, and which such Deposit Account or Securities Account is the subject of a Control Agreement and is maintained by a branch office of the bank or securities intermediary located within the United States.

“Real Property” means any estates or interests in real property now owned or hereafter acquired by Borrower or any of its Subsidiaries and the improvements thereto.

“Real Property Collateral” means the Real Property identified on Schedule R-1 and any Real Property hereafter acquired by Borrower or any of its Subsidiaries.

“Record” means information that is inscribed on a tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form.

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“Remedial Action” means all actions taken to (a) clean up, remove, remediate, contain, treat, monitor, assess, evaluate, or in any way address Hazardous Materials in the indoor or outdoor environment, (b) prevent or minimize a release or threatened release of Hazardous Materials so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (c) restore or reclaim natural resources or the environment, (d) perform any pre-remedial studies, investigations, or post-remedial operation and maintenance activities, or (e) conduct any other actions with respect to Hazardous Materials authorized by Environmental Laws.

“Reserve Percentage” means, on any day, for Lender, the maximum percentage prescribed by the Board of Governors of the Federal Reserve System (or any successor Governmental Authority) for determining the reserve requirements (including any basic, supplemental, marginal, or emergency reserves) that are in effect on such date with respect to eurocurrency funding (currently referred to as “eurocurrency liabilities”) of Lender, but so long as Lender is not required or directed under applicable regulations to maintain such reserves, the Reserve Percentage shall be zero.

“Restatement Date Redemption” means the redemption by Borrower of the Stock of Borrower held by Tyson Shared Services, Inc., for an aggregate redemption price not to exceed $25,000,000.

“Restatement Effective Date” means December 23, 2010.

“Restatement Effective Date Business Plan” means the set of Projections of Borrower for the 3 year period following the Restatement Effective Date (on a year by year basis, and for the 1 year period following the Restatement Effective Date, on a month by month basis), in form and substance (including as to scope and underlying assumptions) reasonably satisfactory to Lender.

“Revolver Usage” means, as of any date of determination, the amount of outstanding Advances.

“SEC” means the United States Securities and Exchange Commission and any successor thereto.

“Securities Account” means a securities account (as that term is defined in the Code).

“Solvent” means, with respect to any Person on a particular date, that, at fair valuations, the sum of such Person’s assets is greater than all of such Person’s debts.

“Stock” means all shares, options, warrants, interests, participations, or other equivalents (regardless of how designated) of or in a Person, whether voting or nonvoting, including common stock, preferred stock, or any other “equity security” (as such term is defined in Rule 3a11-1 of the General Rules and Regulations promulgated by the SEC under the Exchange Act).

“Stock Pledge Agreement” means a stock pledge agreement, in form and substance reasonably satisfactory to Lender, executed and delivered by Borrower to Lender.

“Subordinated Debt” means Indebtedness of Borrower that is on terms and conditions (including payment terms, interest rates, covenants, remedies, defaults and other material terms) satisfactory to the Lender and which (a) has been expressly subordinated in right of payment to all Obligations by the execution and delivery of a subordination agreement, in form and substance satisfactory to Lender and (b) if such Indebtedness is secured by a Lien, such Lien is expressly subordinated to the Liens granted to Lender by the execution and delivery of a subordination agreement, in form and substance satisfactory to Lender.

“Subsidiary” of a Person means a corporation, partnership, limited liability company, or other entity in which that Person directly or indirectly owns or controls the shares of Stock having ordinary voting power to elect a majority of the board of directors (or appoint other comparable managers) of such corporation, partnership, limited liability company, or other entity.

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“Supporting Obligation” means a letter-of-credit right or secondary obligation that supports the payment or performance of an Account, chattel paper, document, General Intangible, instrument, or Investment Property.

“Taxes” has the meaning set forth in Section 16.5.

“Trademark Security Agreement” means a trademark security agreement executed and delivered by Borrower and Lender, the form and substance of which is reasonably satisfactory to Lender.

“TTM EBITDA” means, as of any date of determination, the product of (a) Adjusted EBITDA of Borrower determined on a consolidated basis in accordance with GAAP, for the most recently ended fiscal quarter of Borrower as to which financial statements have been delivered to the Lender pursuant hereto times (b) four (4).

“United States” means the United States of America.

“Voidable Transfer” has the meaning set forth in Section 16.7.

“Warrant Agreement” means an agreement between Borrower and Lender in form and substance reasonably satisfactory to Lender.

1.2 Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with GAAP. When used herein, the term “financial statements” shall include the notes and schedules thereto. Whenever the term “Borrower” is used in respect of a financial covenant or a related definition, it shall be understood to mean Borrower and its Subsidiaries on a consolidated basis unless the context clearly requires otherwise. If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Lender shall so request, the Lender and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP; provided that, until so amended, such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein.

1.3 Code. Any terms used in this Agreement that are defined in the Code shall be construed and defined as set forth in the Code unless otherwise defined herein; provided, however, that to the extent that the Code is used to define any term herein and such term is defined differently in different Articles of the Code, the definition of such term contained in Article 9 shall govern.

1.4 Construction. Unless the context of this Agreement or any other Loan Document clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document, as the case may be, as a whole and not to any particular provision of this Agreement or such other Loan Document, as the case may be. Section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement or in the other Loan Documents to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). Any reference herein to the satisfaction or repayment in full of the Obligations shall mean the repayment in full in cash of all Obligations (other than contingent indemnity Obligations for which no claim has been made). Any

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reference herein to any Person shall be construed to include such Person’s successors and assigns. Any requirement of a writing contained herein or in the other Loan Documents shall be satisfied by the transmission of a Record and any Record transmitted shall constitute a representation and warranty as to the accuracy and completeness of the information contained therein.

1.5 Schedules and Exhibits. All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference.

2. LOAN AND TERMS OF PAYMENT.

2.1 Revolver Advances

(a) Subject to the terms and conditions of this Agreement, and during the term of this Agreement, Lender agrees to make advances (“Advances”, each individually an “Advance”) to Borrower in an amount at any one time outstanding not to exceed the Maximum Revolver Amount.

(b) Amounts borrowed pursuant to this Section 2.1 may be repaid and, subject to the terms and conditions of this Agreement, reborrowed at any time prior to the Maturity Date. The outstanding principal amount of the Advances, together with interest accrued thereon, shall be due and payable on the Maturity Date or, if earlier, on the date on which they are declared due and payable pursuant to the terms of this Agreement.

2.2 [Intentionally omitted.]

2.3 Borrowing Procedures and Settlements.

(a) The Borrower shall give Lender prior telephonic notice (immediately confirmed in writing, in substantially the form of Exhibit N-1 hereto (a “Notice of Borrowing”)), not later than 10:00 a.m. (California time) on the date which is 3 Business Days prior to the date of the proposed Advance (or such shorter period as Lender is willing, in its sole discretion, to accommodate from time to time). Such Notice of Borrowing shall be irrevocable. If no election is specified in the Notice of Borrowing regarding the Interest Period applicable thereto or whether such portion of the Advances is a Base Rate Loan or a LIBOR Rate Loan, then the requested portion of the Advances shall be a Base Rate Loan. If no Interest Period is specified with respect to any requested LIBOR Rate Loan, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration. Lender may act without liability upon the basis of written, telecopied or telephonic notice believed by Lender in good faith to be from the Borrower (or from any Authorized Person thereof designated in writing purportedly from the Borrower to Lender). The Borrower hereby waives the right to dispute the Lender’s record of the terms of any such telephonic Notice of Borrowing. Lender shall be entitled to rely conclusively on any Authorized Person’s authority to request a Borrowing on behalf of the Borrower until Lender receives written notice to the contrary. Lender shall have no duty to verify the authenticity of the signature appearing on any written Notice of Borrowing.

(b) Each Notice of Borrowing pursuant to this Section 2.3 shall be irrevocable and the Borrower shall be bound to make a borrowing in accordance therewith.

2.4 Payments.

(a) Payments by Borrower.

(i) Except as otherwise expressly provided herein, all payments by Borrower shall be made to Lender’s Account for the account of the Lender and shall be made in immediately available funds, no later than 11:00 a.m. (California time) on the date specified herein. Any payment received by Lender later than 11:00 a.m. (California time) shall be deemed to have been received on the following Business Day and any applicable interest or fee shall continue to accrue until such following Business Day.

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(b) Apportionment and Application.

(i) All payments shall be remitted to Lender and all such payments, and all proceeds of Collateral received by Lender, shall be applied as follows:

(A) first, to pay any Lender Expenses then due to Lender under the Loan Documents, until paid in full,

(B) second, to pay any fees then due to Lender under the Loan Documents until paid in full,

(C) third, to pay interest due in respect of the Advances until paid in full,

(D) fourth, to pay all principal amounts in respect of the Advances until paid in full,

(E) fifth, to pay any other Obligations, and

(F) sixth, to Borrower (to be wired to the Designated Account) or such other Person entitled thereto under applicable law.

(ii) In each instance, so long as no Event of Default has occurred and is continuing, this Section 2.4(b) shall not apply to any payment made by Borrower to Lender and specified by Borrower to be for the payment of specific Obligations then due and payable (or prepayable) under any provision of this Agreement.

(iii) For purposes of the foregoing, “paid in full” means payment of all amounts owing under the Loan Documents according to the terms thereof, including loan fees, service fees, professional fees, interest (and specifically including interest accrued after the commencement of any Insolvency Proceeding), default interest, interest on interest, and expense reimbursements, whether or not any of the foregoing would be or is allowed or disallowed in whole or in part in any Insolvency Proceeding.

(iv) In the event of a direct conflict between the priority provisions of this Section 2.4 and other provisions contained in any other Loan Document, it is the intention of the parties hereto that such priority provisions in such documents shall be read together and construed, to the fullest extent possible, to be in concert with each other. In the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this Section 2.4 shall control and govern.

(c) Mandatory Prepayments.

(i) Immediately upon the receipt by Borrower or any of its Subsidiaries of the proceeds of any Disposition by Borrower or any of its Subsidiaries of property or assets (excluding sales or dispositions which qualify as Permitted Dispositions under clauses (a) through (f), (h), or (i) of the definition of Permitted Dispositions), Borrower shall prepay the outstanding principal amount of the Obligations in accordance with Section 2.4(d)(i) in an amount equal to 100% of the Net Cash Proceeds (including condemnation awards and payments in lieu thereof) received by such Person in connection with such sales or dispositions; provided that, so long as (A) no Default or Event of Default shall have occurred and is continuing, (B) the Net Cash Proceeds of such Disposition are held in a cash collateral account in which Lender has a perfected first-priority security interest, and (C) Borrower or its Subsidiaries, as applicable,

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complete such replacement, purchase, or construction within 180 days after the initial receipt of such monies, Borrower and its Subsidiaries shall have the option to apply such monies to the costs of replacement of the property or assets that are the subject of such sale or disposition unless and to the extent that such applicable period shall have expired without such replacement, purchase or construction being made or completed, in which case, such monies shall be paid to Lender and applied in accordance with Section 2.4(d). Nothing contained in this Section 2.4(c)(i) shall permit Borrower or any of its Subsidiaries to sell or otherwise dispose of any property or assets other than in accordance with Section 7.4.

(ii) Immediately upon the issuance or incurrence by Borrower or any of its Subsidiaries of (x) any Indebtedness (except for Indebtedness permitted under Section 7.1) or (y) Stock (except for (A) the issuance of Stock by Borrower to MidOcean or any other Permitted Holder, (B) the issuance of Stock of Borrower to directors, officers and employees of Borrower and its Subsidiaries pursuant to employee stock option plans (or other employee incentive plans or other compensation arrangements) approved by the Board of Directors) Borrower shall prepay the outstanding principal amount of the Obligations in accordance with Section 2.4(d) in an amount equal to 100% of the Net Cash Proceeds received by such Person in connection with such issuance or incurrence. The provisions of this Section 2.4(c)(ii) shall not be deemed to be implied consent to any such issuance or incurrence otherwise prohibited by the terms and conditions of this Agreement.

(d) Application of Payments. Each prepayment pursuant to Section 2.4(c)(i) or 2.4(c)(ii)(x) above shall (i) so long as no Event of Default shall have occurred and be continuing, be applied first, to the outstanding principal amount of the Advances (with a corresponding permanent reduction in the Maximum Revolver Amount), until paid in full, and (ii) if an Event of Default shall have occurred and be continuing, be applied in the manner set forth in Section 2.4(b)(i).

(e) Termination of Revolver. The Maximum Revolver Amount shall be reduced to $0 on the Maturity Date.

(f) Optional Prepayments. Borrower may prepay the principal of any Advance at any time in whole or in part, without premium or penalty.

2.5 Overadvances. If, at any time or for any reason, the amount of Obligations owed by Borrower to Lender pursuant to Sections 2.1 is greater than the Dollar limitations set forth in Sections 2.1, (an “Overadvance”), Borrower immediately shall pay to Lender, in cash, the amount of such excess, which amount shall be used by Lender to reduce the Obligations in accordance with the priorities set forth in Section 2.4(b). In addition, Borrower hereby promises to pay the Obligations (including principal, interest, fees, costs, and expenses) in Dollars in full to Lender as and when due and payable under the terms of this Agreement and the other Loan Documents.

2.6 Interest Rates: Rates, Payments, and Calculations.

(a) Interest Rates. Except as provided in clause (c) below, all Obligations that have been charged to the Loan Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof as follows: (i) if the relevant Obligation is a portion of the Advances that is a LIBOR Rate Loan, at a per annum rate equal to the LIBOR Rate plus the LIBOR Rate Margin, and (ii) if the relevant Obligation is a portion of the Advances that is a Base Rate Loan, at a per annum rate equal to the Base Rate plus the Base Rate Margin.

(b) Default Rate. Upon the occurrence and during the continuation of an Event of Default (and at the election of Lender), all Obligations that have been charged to the Loan Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof at a per annum rate equal to 4 percentage points above the per annum rate otherwise applicable hereunder.

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(c) Payment. Except as provided to the contrary in Section 2.11 or Section 2.13(a), interest, and all other fees payable hereunder shall be due and payable, in arrears, on the first day of each month at any time that Obligations are outstanding or at any time that Lender has an obligation to extend credit hereunder. Borrower hereby authorizes Lender, from time to time without prior notice to Borrower, to charge all interest and fees (when due and payable), all Lender Expenses (as and when incurred), all fees and costs provided for in Section 2.11 (as and when accrued or incurred), and all other payments as and when due and payable under any Loan Document (including the amounts due and payable with respect to the Advances) to Borrower’s Loan Account, which amounts thereafter shall be added to the principal balance of the Advances hereunder and shall accrue interest at the rate then applicable to the Advances hereunder. Any interest not paid when due shall be compounded by being charged to Borrower’s Loan Account and shall thereafter shall be added to the principal balance of the Advances hereunder and shall accrue interest at the rate then applicable to the portion of the Advances that is a Base Rate Loan hereunder.

(d) Computation. All interest and fees chargeable under the Loan Documents shall be computed on the basis of a 360 day year for the actual number of days elapsed (except in the case of Base Rate Loans, which shall be 365 days). In the event the Base Rate is changed from time to time hereafter, the rates of interest hereunder based upon the Base Rate automatically and immediately shall be increased or decreased by an amount equal to such change in the Base Rate.

(e) Intent to Limit Charges to Maximum Lawful Rate. In no event shall the interest rate or rates payable under this Agreement, plus any other amounts paid in connection herewith, exceed the highest rate permissible under any law that a court of competent jurisdiction shall, in a final determination, deem applicable. Borrower and Lender, in executing and delivering this Agreement, intend legally to agree upon the rate or rates of interest and manner of payment stated within it; provided, however, that, anything contained herein to the contrary notwithstanding, if said rate or rates of interest or manner of payment exceeds the maximum allowable under applicable law, then, ipso facto, as of the date of this Agreement, Borrower is and shall be liable only for the payment of such maximum as allowed by law, and payment received from Borrower in excess of such legal maximum, whenever received, shall be applied to reduce the principal balance of the Obligations to the extent of such excess.

2.7 Cash Management.

(a) Borrower shall and shall cause each of its Subsidiaries to (i) establish and maintain cash management services of a type and on terms reasonably satisfactory to Lender at one or more of the banks set forth on Schedule 2.7(a) (each, a “Cash Management Bank”), and shall request in writing and otherwise take such reasonable steps to ensure that all of its and its Subsidiaries’ Account Debtors forward payment of the amounts owed by them directly to such Cash Management Bank, and (ii) deposit or cause to be deposited promptly, and in any event no later than one week after the date of receipt thereof, all of their Collections (including those sent directly by their Account Debtors to Borrower or one of its Subsidiaries) into a bank account (a “Cash Management Account”) at one of the Cash Management Banks; provided that the Borrower may keep up to $25,000 in accounts that are not subject to the foregoing.

(b) Each such Cash Management Agreement shall provide, among other things, that (i) the Cash Management Bank will comply with any instructions originated by Lender directing the disposition of the funds in such Cash Management Account without further consent by Borrower or its Subsidiaries, as applicable, (ii) the Cash Management Bank has no rights of setoff or recoupment or any other claim against the applicable Cash Management Account other than for payment of its service fees and other charges directly related to the administration of such Cash Management Account and for returned checks or other items of payment and (iii) upon the instruction of Lender (an “Activation Instruction”), the Cash Management Bank will forward by daily sweep all amounts in the applicable Cash Management Account to the Lender’s Account. Lender agrees not to issue an Activation Instruction with respect to the Cash Management Accounts unless an Event of Default has occurred and is continuing at the time such Activation Instruction is issued.

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(c) So long as no Default or Event of Default has occurred and is continuing, Borrower may amend Schedule 2.7(a) to add or replace a Cash Management Bank or Cash Management Account; provided, however, that (i) such prospective Cash Management Bank shall be reasonably satisfactory to Lender, and (ii) prior to the time of the opening of such Cash Management Account, Borrower (or its Subsidiary, as applicable) and such prospective Cash Management Bank shall have executed and delivered to Lender a Cash Management Agreement. Borrower (or its Subsidiaries, as applicable) shall close any of its Cash Management Accounts (and establish replacement cash management accounts in accordance with the foregoing sentence) promptly and in any event within 60 days of notice from Lender that the creditworthiness of any Cash Management Bank is no longer acceptable in Lender’s reasonable judgment, or as promptly as practicable and in any event within 90 days of notice from Lender that the operating performance, funds transfer, or availability procedures or performance of the Cash Management Bank with respect to Cash Management Accounts or Lender’s liability under any Cash Management Agreement with such Cash Management Bank is no longer acceptable in Lender’s reasonable judgment.

(d) The Cash Management Accounts shall be cash collateral accounts subject to Control Agreements.

2.8 Crediting Payments. The receipt of any payment item by Lender (whether from transfers to Lender by the Cash Management Banks pursuant to the Cash Management Agreements or otherwise) shall not be considered a payment on account unless such payment item is a wire transfer of immediately available federal funds made to the Lender’s Account or unless and until such payment item is honored when presented for payment. Should any payment item not be honored when presented for payment, then Borrower shall be deemed not to have made such payment and interest shall be calculated accordingly. Anything to the contrary contained herein notwithstanding, any payment item shall be deemed received by Lender only if it is received into the Lender’s Account on a Business Day on or before 11:00 a.m. (California time). If any payment item is received into the Lender’s Account on a non-Business Day or after 11:00 a.m. (California time) on a Business Day, it shall be deemed to have been received by Lender as of the opening of business on the immediately following Business Day.

2.9 Designated Account. Lender is authorized to make Advances under this Agreement based upon telephonic or other instructions received from anyone purporting to be an Authorized Person or, without instructions, if pursuant to Section 2.6(d). Borrower agrees to establish and maintain the Designated Account with the Designated Account Bank for the purpose of receiving the proceeds of the Advances requested by Borrower and made by Lender hereunder. Unless otherwise agreed by Lender and Borrower, any Advance requested by Borrower and made by Lender hereunder shall be made to the Designated Account.

2.10 Maintenance of Loan Account; Statements of Obligations. Lender shall maintain an account on its books in the name of Borrower (the “Loan Account”) on which Borrower will be charged with all payment Obligations hereunder or under the other Loan Documents, including, accrued interest, fees and expenses, and Lender Expenses. In accordance with Section 2.8, the Loan Account will be credited with all payments received by Lender from Borrower or for Borrower’s account, including all amounts received in the Lender’s Account from any Cash Management Bank. Lender shall render statements regarding the Loan Account to Borrower, including principal, interest, fees, and including an itemization of all charges and expenses constituting Lender Expenses owing, and such statements, absent manifest error, shall be conclusively presumed to be correct and accurate and constitute an account stated between Borrower and Lender unless, within 30 days after receipt thereof by Borrower, Borrower shall deliver to Lender written objection thereto describing the error or errors contained in any such statements.

2.11 Fees. Borrower shall pay to Lender the following fees and charges, which fees and charges shall be non-refundable when paid (irrespective of whether this Agreement is terminated thereafter):

(a) Unused Line Fee. On the first day of each month during the term of this Agreement, an unused line fee in an amount equal to 1% per annum times the result of (a) the Maximum Revolver

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Amount, less (b) the average Daily Balance of Advances that were outstanding during the immediately preceding month; provided, however, that if, with respect to any month, Borrower maintains an average balance of amounts on deposit by Borrower at Deposit Accounts maintained at Lender which is in excess of $3,000,000 for such month, the unused line fee with respect to such month will be waived.

(b) Fee Letter Fees. As and when due and payable under the terms of the Fee Letter, the fees set forth in the Fee Letter, and

(c) Audit, Appraisal, and Valuation Charges. Audit, appraisal, and valuation fees and charges shall consist of the actual charges paid or incurred by Lender if it elects to employ the services of one or more third Persons to perform financial audits of Borrower or its Subsidiaries, to establish electronic collateral reporting systems, to appraise the Collateral, or any portion thereof, or to assess Borrower’s or its Subsidiaries’ business valuation; provided, however, that so long as no Event of Default shall have occurred and be continuing, Borrower shall not be obligated to reimburse Lender for more than 2 audits, appraisals or valuations during any calendar year.

2.12 [Intentionally Omitted].

2.13 LIBOR Option.

(a) Interest and Interest Payment Dates. In lieu of having interest charged at the rate based upon the Base Rate, Borrower shall have the option (the “LIBOR Option”) to have interest on all or a portion of the Advances to be charged at a rate of interest based upon the LIBOR Rate. Interest on LIBOR Rate Loans shall be payable on the earliest of (i) the last day of the Interest Period applicable thereto (provided, however, that, subject to the following clauses (ii) and (iii), in the case of any Interest Period greater than 3 months in duration, interest shall be payable at 3 month intervals after the commencement of the applicable Interest Period and on the last day of such Interest Period), (ii) the occurrence of an Event of Default in consequence of which Lender has elected to accelerate the maturity of all or any portion of the Obligations, or (iii) termination of this Agreement pursuant to the terms hereof. On the last day of each applicable Interest Period, unless Borrower properly has exercised the LIBOR Option with respect thereto, the interest rate applicable to such LIBOR Rate Loan automatically shall convert to the rate of interest then applicable to Base Rate Loans of the same type hereunder. At any time that an Event of Default has occurred and is continuing, Borrower no longer shall have the option to request that the Advances bear interest at a rate based upon the LIBOR Rate and Lender shall have the right to convert the interest rate on all outstanding LIBOR Rate Loans to the rate then applicable to Base Rate Loans hereunder.

(b) LIBOR Election.

(i) Borrower may, at any time and from time to time, so long as no Event of Default has occurred and is continuing, elect to exercise the LIBOR Option by notifying Lender prior to 11:00 a.m. (California time) at least 3 Business Days prior to the commencement of the proposed Interest Period (the “LIBOR Deadline”). Notice of Borrower’s election of the LIBOR Option for a permitted portion of the Advances and an Interest Period pursuant to this Section shall be made by delivery to Lender of a LIBOR Notice received by Lender before the LIBOR Deadline, or by telephonic notice received by Lender before the LIBOR Deadline (to be confirmed by delivery to Lender of a LIBOR Notice received by Lender prior to 5:00 p.m. (California time) on the same day.

(ii) Each LIBOR Notice shall be irrevocable and binding on Borrower. In connection with each LIBOR Rate Loan, Borrower shall indemnify, defend, and hold Lender harmless against any loss, cost, or expense incurred by Lender as a result of (a) the payment of any principal of any LIBOR Rate Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any LIBOR Rate Loan other than on the last day of the Interest Period applicable thereto, or (c) the failure to borrow, convert, continue or prepay any LIBOR Rate Loan on the date

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specified in any LIBOR Notice delivered pursuant hereto (such losses, costs, and expenses, collectively, “Funding Losses”). Funding Losses shall be deemed to equal the amount determined by Lender to be the excess, if any, of (i) the amount of interest that would have accrued on the principal amount of such LIBOR Rate Loan had such event not occurred, at the LIBOR Rate that would have been applicable thereto, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert, or continue, for the period that would have been the Interest Period therefor), minus (ii) the amount of interest that would accrue on such principal amount for such period at the interest rate which Lender would be offered were it to be offered, at the commencement of such period, Dollar deposits of a comparable amount and period in the London interbank market. A certificate of Lender delivered to Borrower setting forth any amount or amounts that Lender is entitled to receive pursuant to this Section 2.13 shall be conclusive absent manifest error.

(iii) Borrower shall have not more than 5 LIBOR Rate Loans in effect at any given time. Borrower only may exercise the LIBOR Option for LIBOR Rate Loans of at least $100,000 and integral multiples of $100,000 in excess thereof.

(c) Prepayments. Borrower may prepay LIBOR Rate Loans at any time; provided, however, that in the event that LIBOR Rate Loans are prepaid on any date that is not the last day of the Interest Period applicable thereto, including as a result of any automatic prepayment through the required application by Lender of proceeds of Borrower’s and its Subsidiaries’ Collections in accordance with Section 2.4(b) or for any other reason, including early termination of the term of this Agreement or acceleration of all or any portion of the Obligations pursuant to the terms hereof, Borrower shall indemnify, defend, and hold Lender and its Participants harmless against any and all Funding Losses in accordance with clause (b)(ii) above.

(d) Special Provisions Applicable to LIBOR Rate.

(i) The LIBOR Rate may be adjusted by Lender on a prospective basis to take into account any additional or increased costs to Lender of maintaining or obtaining any eurodollar deposits or increased costs due to changes in applicable law occurring subsequent to the commencement of the then applicable Interest Period, including changes in tax laws (except changes of general applicability in corporate income tax laws) and changes in the reserve requirements imposed by the Board of Governors of the Federal Reserve System (or any successor), excluding the Reserve Percentage, which additional or increased costs would increase the cost of funding loans bearing interest at the LIBOR Rate. In any such event, Lender shall give Borrower written notice of such a determination (with an explanation of the basis for such determination) and adjustment and, upon its receipt of the notice from Lender, Borrower may, by written notice to Lender (y) require Lender to furnish to Borrower a statement setting forth the basis for adjusting such LIBOR Rate and the method for determining the amount of such adjustment, or (z) repay the LIBOR Rate Loans with respect to which such adjustment is made (exclusive of any amounts due under clause (b)(ii) above).

(ii) In the event that any change in market conditions or any law, regulation, treaty, or directive, or any change therein or in the interpretation of application thereof, shall at any time after the date hereof, in the reasonable opinion of Lender, make it unlawful or impractical for Lender to fund or maintain LIBOR Advances or to continue such funding or maintaining, or to determine or charge interest rates at the LIBOR Rate, Lender shall give notice of such changed circumstances to Borrower and (y) in the case of any LIBOR Rate Loans that are outstanding, the date specified in Lender’s notice shall be deemed to be the last day of the Interest Period of such LIBOR Rate Loans, and interest upon the LIBOR Rate Loans thereafter shall accrue interest at the rate then applicable to Base Rate Loans, and (z) Borrower shall not be entitled to elect the LIBOR Option until Lender determines that it would no longer be unlawful or impractical to do so.

(e) No Requirement of Matched Funding. Anything to the contrary contained herein notwithstanding, neither Lender, nor any of its Participants, is required actually to acquire eurodollar deposits

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to fund or otherwise match fund any Obligation as to which interest accrues at the LIBOR Rate. The provisions of this Section 2.13 shall apply as if Lender or its Participants had match funded any Obligation as to which interest is accruing at the LIBOR Rate by acquiring eurodollar deposits for each Interest Period in the amount of the LIBOR Rate Loans.

2.14 Capital Requirements. If, after the date hereof, Lender determines that (i) the adoption of or change in any law, rule, regulation or guideline regarding capital requirements for banks or bank holding companies, or any change in the interpretation or application thereof by any Governmental Authority charged with the administration thereof, or (ii) compliance by Lender or its parent bank holding company with any guideline, request, or directive of any such entity regarding capital adequacy (whether or not having the force of law), has the effect of reducing the return on Lender’s or such holding company’s capital as a consequence of Lender’s obligations hereunder to a level below that which Lender or such holding company could have achieved but for such adoption, change, or compliance (taking into consideration Lender’s or such holding company’s then existing policies with respect to capital adequacy and assuming the full utilization of such entity’s capital) by any amount deemed by Lender to be material, then Lender may provide written notice to Borrower thereof. Following receipt of such written notice, Borrower agrees to pay Lender on demand the amount of such reduction of return of capital as and when such reduction is determined, payable within 90 days after presentation by Lender of a statement in the amount and setting forth in reasonable detail Lender’s calculation thereof and the assumptions upon which such calculation was based (which statement shall be deemed true and correct absent manifest error). In determining such amount, Lender may use any reasonable averaging and attribution methods.

3. CONDITIONS; TERM OF AGREEMENT.

3.1 Conditions Precedent to the Initial Extension of Credit. The obligation of Lender to make the initial extension of credit provided for hereunder on or after the date hereof, is subject to the prior or concurrent fulfillment, to the satisfaction of Lender (the making of such initial extension of credit by Lender being conclusively deemed to be its satisfaction or waiver of the following), of each of the following conditions precedent:

(a) the Restatement Effective Date shall occur on or before December 31, 2010;

(b) Borrower shall have received the MidOcean Investment in an aggregate amount which is at least $47,000,000, which shall be used to, among other things, fund the Restatement Date Redemption and to repay the Existing Term Loan in full, along with any outstanding interest and fees;

(c) Lender shall have received the Fee Letter, in form and substance reasonably satisfactory to Lender, duly executed, and in full force and effect;

(d) Lender shall have received a certificate from the Secretary of Borrower (i) attesting to the resolutions of Borrower’s Board of Directors authorizing its execution, delivery, and performance of this Agreement and the other Loan Documents to which Borrower is a party, (ii) authorizing specific officers of Borrower to execute the same, (iii) attesting to the incumbency and signatures of such specific officers of Borrower, and (iv) attaching true and correct copies of the MidOcean Equity Documents, certified by such officer as being true, correct and complete copies thereof as of the Restatement Effective Date;

(e) Lender shall have received a certificate from the Secretary of Borrower stating that the Governing Documents and Investor Rights Agreement received by Lender pursuant to the Original Loan Agreement remain in full force and effect on and as of the Restatement Effective Date without modification or amendment in any respect;

(f) Lender shall have received a certificate of status with respect to Borrower, dated within 10 days of the Restatement Effective Date, such certificate to be issued by the appropriate officer of the jurisdiction of organization of Borrower, which certificate shall indicate that Borrower is in good standing in such jurisdiction;

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(g) Lender shall have received certificates of status with respect to Borrower, each dated within 30 days of the Restatement Effective Date, such certificates to be issued by the appropriate officer of the jurisdictions (other than the jurisdiction of organization of Borrower) in which its failure to be duly qualified or licensed would constitute a Material Adverse Change, which certificates shall indicate that Borrower is in good standing in such jurisdictions;

(h) Lender shall have received Borrower’s Restatement Effective Date Business Plan; and

(i) Borrower shall have paid all Lender Expenses incurred in connection with the transactions evidenced by this Agreement.

3.2 [Intentionally omitted.]

3.3 Conditions Precedent to all Extensions of Credit. The obligations of Lender to make any Advances hereunder at any time (or to extend any other credit hereunder) shall be subject to the following conditions precedent:

(a) the representations and warranties contained in this Agreement and the other Loan Documents shall be true and correct in all material respects on and as of the date of such extension of credit, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date);

(b) no Default or Event of Default shall have occurred and be continuing on the date of such extension of credit, nor shall either result from the making thereof;

(c) no injunction, writ, restraining order, or other order of any nature restricting or prohibiting, directly or indirectly, the extending of such credit shall have been issued and remain in force by any Governmental Authority against Borrower, Lender, or any of their Affiliates; and

(d) no Material Adverse Change shall have occurred.

3.4 Term.

(a) This Agreement shall continue in full force and effect for a term ending on December 31, 2012 (the “Maturity Date”).

(b) The foregoing notwithstanding, if Borrower either (i) has an Annualized Adjusted EBITDA which is at least $3,000,000 (the “Minimum Annualized EBITDA Target”) or (b) if less than the Minimum Adjusted EBITDA Target, having received a cash equity investment after January 1, 2012 and before November 30, 2012 equal to the difference between Borrower’s Annualized Adjusted EBITDA and the Minimum Annualized EBITDA Target then, upon receipt by Lender of written notice from Borrower on or before December 10, 2012 of its election to extend the Maturity Date, the Maturity Date shall be extended through and including December 31, 2013.

(c) The foregoing notwithstanding, Lender shall have the right to terminate its obligations under this Agreement immediately and without notice upon the occurrence and during the continuation of an Event of Default.

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3.5 Effect of Termination. On the Maturity Date, the outstanding principal amount of the Advances, including any accrued and unpaid interest thereon, shall be due and payable in full in immediately available funds without notice or demand, and on the date of termination of this Agreement, all other Obligations immediately shall be due and payable in full in immediately available funds without notice or demand. No termination of this Agreement, however, shall relieve or discharge Borrower or its Subsidiaries of their duties, Obligations, or covenants hereunder or under any other Loan Documents and the Lender’s Liens in the Collateral shall remain in effect until all Obligations have been paid in full and Lender’s obligations to provide additional credit hereunder have been terminated. When this Agreement has been terminated and all of the Obligations have been paid in full and Lender’s obligations to provide additional credit under the Loan Documents have been terminated irrevocably, Lender will, at Borrower’s sole expense, execute and deliver any termination statements, lien releases, mortgage releases, re-assignments of trademarks, discharges of security interests, and other similar discharge or release documents (and, if applicable, in recordable form) as are reasonably necessary to release, as of record, the Lender’s Liens and all notices of security interests and liens previously filed by Lender with respect to the Obligations.

3.6 Early Termination by Borrower. Borrower has the option, at any time upon 3 Business Days prior written notice to Lender, to terminate this Agreement by paying to Lender, in cash, the Obligations, in full. If Borrower has sent a notice of termination pursuant to the provisions of this Section, then Lender’s obligations to extend credit hereunder shall terminate and Borrower shall be obligated to repay the Obligations, in full.

4. CREATION OF SECURITY INTEREST.

4.1 Grant of Security Interest. Borrower hereby grants to Lender, for the benefit of Lender, a continuing security interest in all of its right, title, and interest in all currently existing and hereafter acquired or arising Borrower Collateral in order to secure prompt repayment of any and all of the Obligations in accordance with the terms and conditions of the Loan Documents and in order to secure prompt performance by Borrower of each of its covenants and duties under the Loan Documents. The Lender’s Liens in and to the Borrower Collateral shall attach to all Borrower Collateral without further act on the part of Lender or Borrower. Anything contained in this Agreement or any other Loan Document to the contrary notwithstanding, except for Permitted Dispositions, Borrower and its Subsidiaries have no authority, express or implied, to dispose of any item or portion of the Collateral.

4.2 Negotiable Collateral. In the event that any Borrower Collateral, including proceeds, is evidenced by or consists of Negotiable Collateral, and if and to the extent that Lender determines that perfection or priority of Lender’s security interest is dependent on or enhanced by possession, Borrower, promptly upon the request of Lender, shall endorse and deliver physical possession of such Negotiable Collateral to Lender.

4.3 Collection of Accounts, General Intangibles, and Negotiable Collateral. At any time after the occurrence and during the continuation of an Event of Default, Lender or Lender’s designee may (a) notify Account Debtors of Borrower that Borrower’s Accounts, chattel paper, or General Intangibles have been assigned to Lender or that Lender has a security interest therein, or (b) collect Borrower’s Accounts, chattel paper, or General Intangibles directly and charge the collection costs and expenses to the Loan Account. Borrower agrees that it will hold in trust for Lender, as Lender’s trustee, any of its or its Subsidiaries’ Collections that it receives and immediately will deliver such Collections to Lender or a Cash Management Bank in their original form as received by Borrower or its Subsidiaries.

4.4 Filing of Financing Statements; Commercial Tort Claims; Delivery of Additional Documentation Required.

(a) Borrower authorizes Lender to file any financing statement necessary or desirable to effectuate the transactions contemplated by the Loan Documents, and any continuation statement or

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amendment with respect thereto, in any appropriate filing office without the signature of Borrower where permitted by applicable law. Borrower hereby ratifies the filing of any financing statement filed without the signature of Borrower prior to the date hereof.

(b) If Borrower or its Subsidiaries acquire any commercial tort claims with a value in excess of $250,000 after the date hereof, Borrower shall promptly (but in any event within 3 Business Days after such acquisition) deliver to Lender a written description of such commercial tort claim and shall deliver a written agreement, in form and substance reasonably satisfactory to Lender, pursuant to which Borrower or its Subsidiary, as applicable, shall grant a perfected security interest in all of its right, title and interest in and to such commercial tort claim to Lender, as security for the Obligations (a “Commercial Tort Claim Assignment”).

(c) At any time upon the request of Lender, Borrower shall execute or deliver to Lender, and shall cause its Subsidiaries to execute or deliver to Lender, any and all financing statements, original financing statements in lieu of continuation statements, amendments to financing statements, fixture filings, security agreements, pledges, assignments, Commercial Tort Claim Assignments, endorsements of certificates of title, and all other documents (collectively, the “Additional Documents”) that Lender may request in its Permitted Discretion, in form and substance reasonably satisfactory to Lender, to create, perfect, and continue perfected or to better perfect the Lender’s Liens in the assets of Borrower and its Subsidiaries (whether now owned or hereafter arising or acquired, tangible or intangible, real or personal), to create and perfect Liens in favor of Lender in any owned Real Property acquired after the Restatement Effective Date, and in order to fully consummate all of the transactions contemplated hereby and under the other Loan Documents. To the maximum extent permitted by applicable law, Borrower authorizes Lender to execute any such Additional Documents in Borrower’s name and authorizes Lender to file such executed Additional Documents in any appropriate filing office. In addition, on such periodic basis as Lender shall require, Borrower shall (i) provide Lender with a report of all new material patentable, copyrightable, or trademarkable materials acquired or generated by Borrower or its Subsidiaries during the prior period, (ii) cause all material patents, copyrights, and trademarks acquired or generated by Borrower or its Subsidiaries that are not already the subject of a registration with the appropriate filing office (or an application therefor diligently prosecuted) to be registered with such appropriate filing office in a manner sufficient to impart constructive notice of Borrower’s or the applicable Subsidiary’s ownership thereof, and (iii) cause to be prepared, executed, and delivered to Lender supplemental schedules to the applicable Loan Documents to identify such patents, copyrights, and trademarks as being subject to the security interests created thereunder ; provided, however, that neither Borrower nor any of its Subsidiaries shall register with the U.S. Copyright Office any unregistered copyrights (whether in existence on the Restatement Effective Date or thereafter acquired, arising, or developed) unless (i) the Borrower provides Lender with written notice of its intent to register such copyrights not less than 30 days prior to the date of the proposed registration, and (ii) prior to such registration, the applicable Person executes and delivers to Lender a Copyright Security Agreement, supplemental schedules to any existing Copyright Security Agreement, or such other documentation as Lender reasonably deems necessary in order to perfect and continue perfected Lender’s Liens on such copyrights following such registration.

4.5 Power of Attorney. Borrower hereby irrevocably makes, constitutes, and appoints Lender (and any of Lender’s officers, employees, or agents designated by Lender) as Borrower’s true and lawful attorney, with power to (a) if Borrower refuses to, or fails timely to execute and deliver any of the documents described in Section 4.4, sign the name of Borrower on any of the documents described in Section 4.4, (b) at any time that an Event of Default has occurred and is continuing, sign Borrower’s name on any invoice or bill of lading relating to the Borrower Collateral, drafts against Account Debtors, or notices to Account Debtors, (c) send requests for verification of Borrower’s or its Subsidiaries’ Accounts, (d) endorse Borrower’s name on any of its payment items (including all of its Collections) that may come into Lender’s possession, (e) at any time that an Event of Default has occurred and is continuing, make, settle, and adjust all claims under Borrower’s policies of insurance and make all determinations and decisions with respect to such policies of insurance, and (f) at any time that an Event of Default has occurred and is continuing, settle and adjust disputes and claims respecting Borrower’s or its Subsidiaries’ Accounts, chattel paper, or General Intangibles directly

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with Account Debtors, for amounts and upon terms that Lender determines to be reasonable, and Lender may cause to be executed and delivered any documents and releases that Lender determines to be necessary. The appointment of Lender as Borrower’s attorney, and each and every one of its rights and powers, being coupled with an interest, is irrevocable until all of the Obligations have been fully and finally repaid and performed and Lender’s obligations to extend credit hereunder are terminated.

4.6 Right to Inspect. Lender (through any of its officers, employees, or agents) shall have the right, from time to time hereafter to inspect the Books and make copies or abstracts thereof and to check, test, and appraise the Collateral, or any portion thereof, in order to verify Borrower’s and its Subsidiaries’ financial condition or the amount, quality, value, condition of, or any other matter relating to, the Collateral.

4.7 Control Agreements. Borrower agrees that it will and will cause its Subsidiaries to take commercially reasonable steps in order for Lender to obtain control in accordance with Sections 8-106, 9-104, 9-105, 9-106, and 9-107 of the Code with respect to (subject to the proviso contained in Section 7.12) all of its or their Securities Accounts, Deposit Accounts, electronic chattel paper, Investment Property, and letter-of-credit rights. Upon the occurrence and during the continuance of a Default or Event of Default, Lender may notify any bank or securities intermediary to liquidate the applicable Deposit Account or Securities Account or any related Investment Property maintained or held thereby and remit the proceeds thereof to the Lender’s Account.

5. REPRESENTATIONS AND WARRANTIES.

In order to induce Lender to enter into this Agreement, Borrower makes the following representations and warranties to Lender which shall be true, correct, and complete, in all material respects, as of the date hereof, and shall be true, correct, and complete, in all material respects, as of the Restatement Effective Date, and at and as of the date of the making of each portion of the Advances (or other extension of credit) made thereafter, as though made on and as of the date of such portion of the Advances (or other extension of credit) (except to the extent that such representations and warranties relate solely to an earlier date) and such representations and warranties shall survive the execution and delivery of this Agreement:

5.1 No Encumbrances. Borrower and its Subsidiaries have good and indefeasible title to, or a valid leasehold interest in, their personal property assets and good and marketable title to, or a valid leasehold interest in, their Real Property, in each case, free and clear of Liens except for Permitted Liens.

5.2 [Intentionally Omitted].

5.3 [Intentionally Omitted].

5.4 Equipment. All of the Equipment of Borrower and its Subsidiaries that is necessary or material to conduct their business is used or held for use in their business and is fit for such purposes.

5.5 Location of Inventory and Equipment. The Inventory and Equipment of Borrower and its Subsidiaries (other than (w) Equipment out for repair, (x) Equipment in transit between such locations, (y) Chillers located at one or more of the Installed Stores and (z) other Equipment with an after market value not in excess of $250,000) are not stored with a bailee, warehouseman, or similar party and (other than (w) Equipment out for repair, (x) Equipment in transit between such locations, (y) Chillers located at one or more of the Installed Stores and (z) other Equipment with an after market value not in excess of $250,000) are located only at, or in-transit between, the locations identified on Schedule 5.5 (as such Schedule may be updated pursuant to Section 6.9).

5.6 Inventory Records. Borrower keeps correct and accurate records itemizing and describing the type, quality, and quantity of its and its Subsidiaries’ Inventory and the book value thereof.

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5.7 State of Incorporation; Location of Chief Executive Office; Organizational Identification Number; Commercial Tort Claims.

(a) The jurisdiction of organization of Borrower and each of its Subsidiaries is set forth on Schedule 5.7(a).

(b) The chief executive office of Borrower and each of its Subsidiaries is located at the address indicated on Schedule 5.7 (b) (as such Schedule may be updated pursuant to Section 6.9).

(c) Borrower’s and each of its Subsidiaries’ organizational identification numbers, if any, are identified on Schedule 5.7(c).

(d) As of the Restatement Effective Date, Borrower and its Subsidiaries do not hold any commercial tort claims, except as set forth on Schedule 5.7(d).

5.8 Due Organization and Qualification; Subsidiaries.

(a) Borrower is duly organized and existing and in good standing under the laws of the jurisdiction of its organization and qualified to do business in any state where the failure to be so qualified reasonably could be expected to result in a Material Adverse Change.

(b) Set forth on Schedule 5.8(b), is a complete and accurate description of the authorized capital Stock of Borrower, by class, and, as of the Restatement Effective Date, a description of the number of shares of each such class that are issued and outstanding. Other than as described on Schedule 5.8(b), there are no subscriptions, options, warrants, or calls relating to any shares of Borrower’s capital Stock, including any right of conversion or exchange under any outstanding security or other instrument. Borrower is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital Stock or any security convertible into or exchangeable for any of its capital Stock.

(c) Set forth on Schedule 5.8(c), is a complete and accurate list of Borrower’s direct and indirect Subsidiaries, showing: (i) the jurisdiction of their organization, (ii) the number of shares of each class of common and preferred Stock authorized for each of such Subsidiaries, and (iii) the number and the percentage of the outstanding shares of each such class owned directly or indirectly by Borrower. All of the outstanding capital Stock of each such Subsidiary has been validly issued and is fully paid and in the case of a corporation, non-assessable.

(d) Except as set forth on Schedule 5.8(c), there are no subscriptions, options, warrants, or calls relating to any shares of Borrower’s Subsidiaries’ capital Stock, including any right of conversion or exchange under any outstanding security or other instrument. Neither Borrower nor any of its Subsidiaries is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of Borrower’s Subsidiaries’ capital Stock or any security convertible into or exchangeable for any such capital Stock.

5.9 Due Authorization; No Conflict.

(a) The execution, delivery, and performance by Borrower of this Agreement and the Loan Documents to which it is a party have been duly authorized by all necessary action on the part of Borrower.

(b) The execution, delivery, and performance by Borrower of this Agreement and the other Loan Documents to which it is a party do not and will not (i) violate any provision of federal, state, or local law or regulation applicable to Borrower, the Governing Documents of Borrower, or any order, judgment, or decree of any court or other Governmental Authority binding on Borrower, (ii) conflict with,

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result in a breach of, or constitute (with due notice or lapse of time or both) a default under any contractual obligation of Borrower, (iii) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of Borrower, other than Permitted Liens, or (iv) require any approval of Borrower’s interestholders or any approval or consent of any Person under any contractual obligation of Borrower, other than consents or approvals that have been obtained and that are still in force and effect except in the case of clauses (ii) or (iv) where the failure to do so could not reasonably be expected to result in a Material Adverse Change.

(c) Other than the filing of financing statements and the recordation of the Mortgages, the execution, delivery, and performance by Borrower of this Agreement and the other Loan Documents to which Borrower is a party do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority, other than consents or approvals that have been obtained and that are still in force and effect.

(d) This Agreement and the other Loan Documents to which Borrower is a party, and all other documents contemplated hereby and thereby, when executed and delivered by Borrower will be the legally valid and binding obligations of Borrower, enforceable against Borrower in accordance with their respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally.

(e) The Lender’s Liens are validly created, perfected, and first priority Liens, subject only to Permitted Liens.

(f) The Restatement Date Redemption by Borrower is permitted under applicable law.

5.10 Litigation. Other than those matters described on Schedule 5.10 and other than matters arising after the Restatement Effective Date that reasonably could not be expected to result in a Material Adverse Change, there are no actions, suits, or proceedings pending or, to the best knowledge of Borrower, threatened against Borrower or any of its Subsidiaries.

5.11 No Material Adverse Change. All financial statements relating to Borrower and its Subsidiaries that have been delivered by Borrower to Lender have been prepared in accordance with GAAP (except, in the case of unaudited financial statements, for the lack of footnotes and being subject to year-end audit adjustments and reclassifications) and present fairly in all material respects, Borrower’s and its Subsidiaries’ financial condition as of the date thereof and results of operations for the period then ended. There has not been a Material Adverse Change with respect to Borrower and its Subsidiaries since the date of the latest financial statements submitted to Lender on or before the Restatement Effective Date.

5.12 Fraudulent Transfer.

(a) The Loan Parties on a consolidated basis are Solvent.

(b) No transfer of property is being made by Borrower or its Subsidiaries and no obligation is being incurred by Borrower or its Subsidiaries in connection with the transactions contemplated by this Agreement or the other Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of Borrower or its Subsidiaries.

5.13 Employee Benefits. None of Borrower, any of its Subsidiaries, or any of their ERISA Affiliates maintains or contributes to any Benefit Plan.

5.14 Environmental Condition. Except as set forth on Schedule 5.14, (a) to Borrower’s knowledge, none of Borrower’s or its Subsidiaries’ properties or assets has ever been used by Borrower, its Subsidiaries, or by previous owners or operators in the disposal of, or to produce, store, handle, treat, release,

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or transport, any Hazardous Materials, where such use, production, storage, handling, treatment, release or transport was in violation, in any material respect, of any applicable Environmental Law, (b) to Borrower’s knowledge, none of Borrower’s or its Subsidiaries’ properties or assets has ever been designated or identified in any manner pursuant to any environmental protection statute as a Hazardous Materials disposal site, (c) neither Borrower nor any of its Subsidiaries has received notice that a Lien arising under any Environmental Law has attached to any revenues or to any Real Property owned or operated by Borrower or its Subsidiaries, and (d) neither Borrower nor its Subsidiaries has received a summons, citation, notice, or directive from the United States Environmental Protection Agency or any other federal or state governmental agency concerning any action or omission by Borrower or its Subsidiaries resulting in the releasing or disposing of Hazardous Materials into the environment that individually or in the aggregate could reasonably be expected to result in a Material Adverse Change.

5.15 Brokerage Fees. Neither Borrower nor any of its Subsidiaries has utilized the services of any broker or finder in connection with Borrower’s obtaining financing from Lender under this Agreement and no brokerage commission or finders fee is payable by Borrower or its Subsidiaries in connection herewith.

5.16 Intellectual Property. Borrower and its Subsidiaries own, or hold licenses in, all trademarks, trade names, copyrights, patents, patent rights, and licenses that are necessary to the conduct of its business as currently conducted, and attached hereto as Schedule 5.16 (as updated from time to time) is a true, correct, and complete listing of all material patents, patent applications, trademarks, trademark applications, copyrights, and copyright registrations as to which Borrower or one of its Subsidiaries is the owner or is an exclusive licensee.

5.17 Leases. Borrower and its Subsidiaries enjoy peaceful and undisturbed possession under all leases material to their business and to which they are parties or under which they are operating, and all of such leases are valid and subsisting and no material default by Borrower or its Subsidiaries exists under any of them.

5.18 Deposit Accounts and Securities Accounts. Set forth on Schedule 5.18 (as updated from time to time) is a listing of all of Borrower’s and its Subsidiaries’ Deposit Accounts and Securities Accounts, including, with respect to each bank or securities intermediary (a) the name and address of such Person, and (b) the account numbers of the Deposit Accounts or Securities Accounts maintained with such Person.

5.19 Complete Disclosure. All factual information (taken as a whole) furnished by or on behalf of Borrower or its Subsidiaries in writing to Lender (including all information contained in the Schedules hereto or in the other Loan Documents) for purposes of or in connection with this Agreement, the other Loan Documents, or any transaction contemplated herein or therein is, and all other such factual information (taken as a whole) hereafter furnished by or on behalf of Borrower or its Subsidiaries in writing to Lender will be, true and accurate, in all material respects, on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material respect at such time in light of the circumstances under which such information was provided. On the Restatement Effective Date, the Restatement Effective Date Projections represent, and as of the date on which any other Projections are delivered to Lender, such additional Projections represent Borrower’s good faith estimate of its and its Subsidiaries’ future performance for the periods covered thereby (it being understood that actual results may vary from such forecasts and that such variances may be material).

5.20 Indebtedness. Set forth on Schedule 5.20 is a true and complete list of all Indebtedness of Borrower and its Subsidiaries outstanding immediately prior to the Restatement Effective Date that is to remain outstanding after the Restatement Effective Date and such Schedule accurately reflects the aggregate principal amount of such Indebtedness and describes the principal terms thereof.

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6. AFFIRMATIVE COVENANTS.

Borrower covenants and agrees that, so long as any credit hereunder shall be available and until payment in full of the Obligations, Borrower shall and shall cause each of its Subsidiaries to do all of the following:

6.1 Accounting System. Maintain a system of accounting that enables Borrower to produce financial statements in accordance with GAAP and maintain records pertaining to the Collateral that contain information as from time to time reasonably may be requested by Lender. Borrower also shall keep a reporting system that shows all additions, sales, claims, returns, and allowances with respect to its and its Subsidiaries’ sales.

6.2 Collateral Reporting. Provide Lender with the following documents at the following times in form reasonably satisfactory to Lender:

Monthly (not later than the 15th day of each month)

(a) a detailed aging, by total, of the Accounts of Borrower, and (b) a detailed list of Borrower’s and its Subsidiaries’ customers, including number of Installed Store locations, and (c) a summary aging, by vendor, of Borrower’s and its Subsidiaries’ accounts payable and any book overdraft.

Upon request by Lender

(d) copies of invoices in connection with Borrower’s and its Subsidiaries’ Accounts, credit memos, remittance advices, deposit slips, shipping and delivery documents in connection with Borrower’s and its Subsidiaries’ Accounts and, for Inventory and Equipment acquired by Borrower or its Subsidiaries, purchase orders and invoices, and (e) such other reports as to the Collateral or the financial condition of Borrower and its Subsidiaries, as Lender may request.

6.3 Financial Statements, Reports, Certificates. Deliver to Lender:

(a) as soon as available, but in any event within (x) prior to the date when Borrower’s TTM EBITDA for any twelve month period ending after the Restatement Effective Date exceeds $3,000,000, 30 days after the end of each month, and (y) thereafter, within 45 days after the end of each fiscal quarter during each of Borrower’s fiscal years,

(i) an unaudited consolidated and consolidating balance sheet, income statement, and statement of cash flow covering Borrower’s and its Subsidiaries’ operations during such period and for the three month period then ended, and

(ii) a Compliance Certificate,

(b) as soon as available, but in any event within 120 days after the end of each of Borrower’s fiscal years,

(i) consolidated and consolidating financial statements of Borrower and its Subsidiaries for each such fiscal year, audited by independent certified public accountants reasonably acceptable to Lender and certified, without any qualifications (including any (A) “going concern” or like qualification or exception (except to the extent that such qualification or exception is due solely to the fact that the Maturity Date at the time of such audit is scheduled to occur within twelve months of the end of such fiscal year), (B) qualification or exception as to the scope of such audit, or (C) qualification which relates to the

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treatment or classification of any item and which, as a condition to the removal of such qualification, would require an adjustment to such item, the effect of which would be to cause any noncompliance with the provisions of Section 7.18), by such accountants to have been prepared in accordance with GAAP (such audited financial statements to include a balance sheet, income statement, and statement of cash flow and, if prepared, such accountants’ letter to management),

(ii) a Compliance Certificate,

(c) as soon as available, but in any event within 30 days after the start of each of Borrower’s fiscal years, copies of Borrower’s Projections, in form (including as to scope) satisfactory to Lender, in its Permitted Discretion, for the forthcoming 3 years, year by year, and for the forthcoming fiscal year, month by month, certified by the chief financial officer of Borrower as being such officer’s good faith estimate of the financial performance of Borrower during the period covered thereby,

(d) if and when filed by Borrower,

(i) Form 10-Q quarterly reports, Form 10-K annual reports, and Form 8-K current reports,

(ii) any other filings made by Borrower with the SEC,

(iii) any other information that is provided by Borrower to its shareholders generally,

(e) promptly, but in any event within 5 days after a senior officer of Borrower has knowledge of any event or condition that constitutes a Default or an Event of Default, notice thereof and a statement of the curative action that Borrower proposes to take with respect thereto (if any),

(f) promptly after the commencement thereof, but in any event within 5 days after the service of process with respect thereto on Borrower or any of its Subsidiaries, notice of all actions, suits, or proceedings brought by or against Borrower or any of its Subsidiaries before any Governmental Authority which reasonably could be expected to result in a Material Adverse Change, and

(g) upon the request of Lender, any other information reasonably requested relating to the financial condition of Borrower or its Subsidiaries.

In addition, Borrower agrees that no Subsidiary of Borrower will have a fiscal year different from that of Borrower. Borrower also agrees to cooperate with Lender to allow Lender to consult with its independent certified public accountants if Lender reasonably requests the right to do so and that, in such connection, its independent certified public accountants are authorized to communicate with Lender and to release to whatever financial information concerning Borrower or its Subsidiaries that Lender reasonably may request.

6.4 Guarantor Reports. Cause each Guarantor to deliver its annual financial statements at the time when Borrower provides its audited financial statements to Lender, but only to the extent such Guarantor’s financial statements are not consolidated with Borrower’s financial statements.

6.5 [Intentionally omitted.]

6.6 Maintenance of Properties. Maintain and preserve all of its properties which are necessary or material to the proper conduct to its business in good working order and condition, ordinary wear and tear excepted, and comply at all times with the provisions of all material leases to which it is a party as lessee, so as to prevent any loss or forfeiture thereof or thereunder.

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6.7 Taxes. Cause all assessments and taxes, whether real, personal, or otherwise, due or payable by, or imposed, levied, or assessed against Borrower, its Subsidiaries, or any of their respective assets to be paid in full, before delinquency or before the expiration of any extension period, except to the extent that the validity of such assessment or tax shall be the subject of a Permitted Protest. Borrower will and will cause its Subsidiaries to make timely payment or deposit of all tax payments and withholding taxes required of it and them by applicable laws, including those laws concerning F.I.C.A., F.U.T.A., state disability, and local, state, and federal income taxes, and will, upon request, furnish Lender with proof satisfactory to Lender indicating that Borrower and its Subsidiaries have made such payments or deposits.

6.8 Insurance.

(a) At Borrower’s expense, maintain insurance respecting its and its Subsidiaries’ assets wherever located, covering loss or damage by fire, theft, explosion, and all other hazards and risks as ordinarily are insured against by other Persons engaged in the same or similar businesses. Borrower also shall maintain business interruption, public liability, and product liability insurance, as well as insurance against larceny, embezzlement, and criminal misappropriation. All such policies of insurance shall be in such amounts and with such insurance companies as are reasonably satisfactory to Lender (it being understood and agreed that the insurance company that provides such insurance on the Restatement Effective Date, and the amounts of the insurance maintained on the Restatement Effective Date shall be deemed to be satisfactory to Lender). Borrower shall deliver copies of all such policies to Lender with an endorsement naming Lender as the sole loss payee (under a satisfactory lender’s loss payable endorsement) or additional insured, as appropriate (except with respect to business interruption). Each policy of insurance or endorsement shall contain a clause requiring the insurer to give not less than 30 days prior written notice to Lender in the event of cancellation of the policy for any reason whatsoever.

(b) Borrower shall give Lender prompt notice of any loss in excess of $250,000 covered by such insurance. Lender shall have the exclusive right to adjust any losses claimed under any such insurance policies after the occurrence and during the continuation of an Event of Default, without any liability to Borrower whatsoever in respect of such adjustments. Any monies received as payment for any loss under any insurance policy mentioned above (other than liability insurance policies) or as payment of any award or compensation for condemnation or taking by eminent domain shall be applied as set forth in, subject to Section 2.4(c).

(c) Borrower will not and will not suffer or permit its Subsidiaries to take out separate insurance concurrent in form or contributing in the event of loss with that required to be maintained under this Section 6.7, unless Lender is included thereon as an additional insured or loss payee under a lender’s loss payable endorsement. Borrower promptly shall notify Lender whenever such separate insurance is taken out, specifying the insurer thereunder and full particulars as to the policies evidencing the same, and copies of such policies promptly shall be provided to Lender.

6.9 Location of Inventory and Equipment. Keep Borrower’s and its Subsidiaries’ Inventory and Equipment (other than (w) Equipment out for repair, (x) Equipment in transit between such locations, (y) Chillers located at, or in transit to, one or more of the Installed Stores and (z) other Equipment with an after market value not in excess of $250,000) only at the locations identified on Schedule 5.5 and their chief executive offices only at the locations identified on Schedule 5.7(b); provided, however, that Borrower may amend Schedule 5.5 and Schedule 5.7 so long as such amendment occurs by written notice to Lender not less than 30 after the date on which such Inventory or Equipment is moved to such new location or such chief executive office is relocated, so long as such new location is within the continental United States, and so long as, at the time of such written notification, Borrower uses commercially reasonable efforts to provide to Lender a Collateral Access Agreement with respect thereto.

6.10 Compliance with Laws. Comply with the requirements of all applicable laws, rules, regulations, and orders of any Governmental Authority, other than laws, rules, regulations, and orders the non- compliance with which, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Change.

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6.11 Leases. Pay when due all rents and other amounts, in each case to the extent that such amounts that are not paid when due exceed $150,000 in the aggregate at any one time, payable under any material leases to which Borrower or any of its Subsidiaries is a party or by which Borrower’s or any such Subsidiaries’ properties and assets are bound, unless such payments are the subject of a Permitted Protest.

6.12 Existence. At all times preserve and keep in full force and effect Borrower’s and its Subsidiaries’ existence and good standing and any rights and franchises material to their businesses; provided, however, that neither Borrower or any of its Subsidiaries shall be required to preserve any such right or franchise if such Person’s board of directors (or similar governing body) shall determine that the preservation thereof is no longer desirable in the conduct of the business of such Person, and that the loss thereof is not disadvantageous in any material respect to such Person or to Lender.

6.13 Environmental.

(a) Keep any property either owned or operated by Borrower or its Subsidiaries free of any Environmental Liens or post bonds or other financial assurances sufficient to satisfy the obligations or liability evidenced by such Environmental Liens, (b) comply, in all material respects, with Environmental Laws and provide to Lender documentation of such compliance which Lender reasonably requests, (c) promptly notify Lender of any release of a Hazardous Material in any reportable quantity from or onto property owned or operated by Borrower or its Subsidiaries and take any Remedial Actions required to abate said release or otherwise to come into compliance with applicable Environmental Law, and (d) promptly, but in any event within 5 days of its receipt thereof, provide Lender with written notice of any of the following: (i) notice that an Environmental Lien has been filed against any of the real or personal property of Borrower or its Subsidiaries, (ii) commencement of any Environmental Action or notice that an Environmental Action will be filed against Borrower or its Subsidiaries, and (iii) notice of a violation, citation, or other administrative order which reasonably could be expected to result in a Material Adverse Change.

6.14 Disclosure Updates. Promptly and in no event later than 5 Business Days after obtaining knowledge thereof, notify Lender if any written information, exhibit, or report furnished to Lender contained, at the time it was furnished, any untrue statement of a material fact or omitted to state any material fact necessary to make the statements contained therein not misleading in light of the circumstances in which made. The foregoing to the contrary notwithstanding, any notification pursuant to the foregoing provision will not cure or remedy the effect of the prior untrue statement of a material fact or omission of any material fact nor shall any such notification have the affect of amending or, modifying this Agreement or any of the Schedules hereto.

6.15 Formation of Subsidiaries. At the time that Borrower or any Guarantor forms any direct or indirect Subsidiary or acquires any direct or indirect Subsidiary after the Restatement Effective Date, Borrower or such Guarantor shall (a) cause such new Subsidiary to provide to Lender a Guaranty, Guarantor Security Agreement, and Intercompany Subordination Agreement (or joinder thereto), together with such other security documents (including Mortgages with respect to any Real Property of such new Subsidiary), as well as appropriate financing statements (and with respect to all property subject to a Mortgage, fixture filings), all in form and substance satisfactory to Lender (including being sufficient to grant Lender a first priority Lien (subject to Permitted Liens) in and to the assets of such newly formed or acquired Subsidiary); provided that the Guaranty, Guarantor Security Agreement, and such other security documents shall not be required to be provided to Lender with respect to any Subsidiary of Borrower that is a CFC if providing such documents would result in material adverse tax consequences, (b) within 10 days of such formation or acquisition) or such later date as permitted by Lender in its sole discretion) provide to Lender a pledge agreement and appropriate certificates and powers or financing statements, hypothecating all of the direct or beneficial ownership interest in such new Subsidiary, in form and substance satisfactory to Lender; provided that only 65% of the total

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outstanding voting Stock of any first tier Subsidiary of Borrower that is a CFC (and none of any Subsidiary of such CFC) shall be required to be pledged if pledging a greater amount would result in material adverse tax consequences (which pledge, if reasonably requested by Lender, shall be governed by the laws of the jurisdiction of such Subsidiary), and (c) within 10 days of such formation or acquisition (or such later date as permitted by Lender) provide to Lender all other documentation, including one or more opinions of counsel satisfactory to Lender, which in its opinion is appropriate with respect to the execution and delivery of the applicable documentation referred to above (including policies of title insurance or other documentation with respect to all property subject to a Mortgage). Any document, agreement, or instrument executed or issued pursuant to this Section 6.15 shall be a Loan Document.

6.16 Canadian Subsidiary. Within 30 days after the written request therefor by Lender, Borrower shall (a) cause such Canadian Subsidiary to provide to Lender a guaranty and security agreement, together with such other security documents (including Mortgages with respect to any Real Property of such new Subsidiary), in each case governed under Ontario law, as well as appropriate financing statements (and with respect to all property subject to a Mortgage, fixture filings), all in form and substance satisfactory to Lender (including being sufficient to grant Lender a first priority Lien (subject to Permitted Liens) in and to the assets of such newly formed or acquired Subsidiary); provided that such guaranty, security agreement, and such other security documents shall not be required to be provided to Lender with respect to such Canadian Subsidiary if providing such documents would result in material adverse tax consequences, and (b) provide to Lender all other documentation, including one or more opinions of counsel satisfactory to Lender, which in its opinion is appropriate with respect to the execution and delivery of the applicable documentation referred to above (including policies of title insurance or other documentation with respect to all property subject to a Mortgage); provided that only 65% of the total outstanding voting Stock of the Canadian Subsidiary (and none of any Subsidiary of such Canadian Subsidiary) shall be required to be pledged if pledging a greater amount would result in material adverse tax consequences (which pledge, if reasonably requested by Lender, shall be governed under Ontario law). Any document, agreement, or instrument executed or issued pursuant to this Section 6.16 shall be a Loan Document.

7. NEGATIVE COVENANTS.

Borrower covenants and agrees that, so long as any credit hereunder shall be available and until payment in full of the Obligations, Borrower will not and will not permit any of its Subsidiaries to do any of the following:

7.1 Indebtedness. Create, incur, assume, suffer to exist, guarantee, or otherwise become or remain, directly or indirectly, liable with respect to any Indebtedness, except for:

(a) Indebtedness evidenced by this Agreement and the other Loan Documents,

(b) Indebtedness set forth on Schedule 5.20,

(c) Permitted Purchase Money Indebtedness,

(d) refinancings, renewals, or extensions of Indebtedness permitted under clauses (b) and (c) above (and continuance or renewal of any Permitted Liens associated therewith) so long as: (i) the terms and conditions of such refinancings, renewals, or extensions do not, in Lender’s reasonable judgment, materially impair the prospects of repayment of the Obligations by Borrower or materially impair Borrower’s creditworthiness, (ii) such refinancings, renewals, or extensions do not result in an increase in the principal amount of, or interest rate with respect to, the Indebtedness so refinanced, renewed, or extended, (iii) such refinancings, renewals, or extensions do not result in a shortening of the average weighted maturity of the Indebtedness so refinanced, renewed, or extended, nor are they on terms or conditions that, taken as a whole, are materially more burdensome or restrictive to Borrower, (iv) if the Indebtedness that is refinanced, renewed, or extended was subordinated in right of payment to the Obligations, then the terms and conditions of the

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refinancing, renewal, or extension Indebtedness must include subordination terms and conditions that are at least as favorable to Lender as those that were applicable to the refinanced, renewed, or extended Indebtedness, and (v) the Indebtedness that is refinanced, renewed, or extended is not recourse to any Person that is liable on account of the Obligations other than those Persons which were obligated with respect to the Indebtedness that was refinanced, renewed, or extended,

(e) endorsement of instruments or other payment items for deposit,

(f) Indebtedness composing Permitted Investments,

(g) [intentionally omitted]

(h) Subordinated Debt,

(i) Hedge Obligations, and

(j) other unsecured Indebtedness in an aggregate amount not to exceed $2,500,000 at any time outstanding.

7.2 Liens. Create, incur, assume, or suffer to exist, directly or indirectly, any Lien on or with respect to any of its assets, of any kind, whether now owned or hereafter acquired, or any income or profits therefrom, except for Permitted Liens (including Liens that are replacements of Permitted Liens to the extent that the original Indebtedness is refinanced, renewed, or extended under Section 7.1(e) and so long as the replacement Liens only encumber those assets that secured the refinanced, renewed, or extended Indebtedness).

7.3 Restrictions on Fundamental Changes.

(a) Enter into any merger, consolidation, reorganization, or recapitalization, or reclassify its Stock other than (i) to consummate a Permitted Acquisition and (ii) mergers between Borrower and any of its Subsidiaries, provided that Borrower is the surviving entity of such merger and remains an entity organized under the laws of a state within the United States.

(b) Liquidate, wind up, or dissolve itself (or suffer any liquidation or dissolution).

(c) Convey, sell, lease, license, assign, transfer, or otherwise dispose of, in one transaction or a series of transactions, all or any substantial part of its assets.

7.4 Disposal of Assets. Other than Permitted Dispositions, convey, sell, lease, license, assign, transfer, or otherwise dispose of any of Borrower’s or its Subsidiaries’ assets.

7.5 Change Name. Change Borrower’s or any of its Subsidiaries’ names, organizational identification number, state of organization or organizational identity; provided, however, that Borrower or any of its Subsidiaries may change their names upon at least 30 days prior written notice to Lender of such change and so long as, at the time of such written notification, Borrower or its Subsidiary provides any financing statements necessary to perfect and continue perfected the Lender’s Liens.

7.6 Nature of Business. Make any change in the principal nature of its or their business.

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7.7 Prepayments and Amendments. Except in connection with a refinancing permitted by Section 7.1(e),

(a) optionally prepay, redeem, defease, purchase, or otherwise acquire any Subordinated Indebtedness of Borrower or its Subsidiaries, other than the Obligations in accordance with this Agreement, or

(b) directly or indirectly, amend, modify, alter, increase, or change any of the terms or conditions of any agreement, instrument, document, indenture, or other writing evidencing or concerning Indebtedness permitted under Section 7.1(b) to the extent that such amendment, modification, or change could, individually or in the aggregate, reasonably be expected to be materially adverse to the interests of the Lender.

7.8 Change of Control. Cause, permit, or suffer, directly or indirectly, any Change of Control.

7.9 Consignments. Consign any of its or their Inventory or sell any of its or their Inventory on bill and hold, sale or return, sale on approval, or other conditional terms of sale.

7.10 Distributions. Make any distribution or declare or pay any dividends (in cash or other property, other than common Stock) on, or purchase, acquire, redeem, or retire any of Borrower’s Stock, of any class, whether now or hereafter outstanding (each, a “Distribution”), other than (a) so long as no Default or Event of Default has occurred and is continuing or would result therefrom, Borrower may make distributions to former employees, officers, or directors of Borrower (or any spouses, ex-spouses, or estates of any of the foregoing) on account of redemptions of Stock of Borrower held by such Persons, provided that the aggregate amount of such redemptions made by Borrower during any fiscal year does not exceed $500,000, (b) dividends and distributions declared and paid on the Stock of any Subsidiary of Borrower ratably to the holders of such Stock, (c) cashless repurchases of Stock of the Borrower deemed to occur upon exercise of stock options or warrants if such Stock represent a portion of the exercise price of such options or warrants, and (d) the Restatement Date Redemption.

7.11 Accounting Methods. Modify or change its fiscal year or its method of accounting (other than as may be required or permitted to conform to GAAP) or enter into, modify, or terminate any agreement currently existing, or at any time hereafter entered into with any third party accounting firm or service bureau for the preparation or storage of Borrower’s or its Subsidiaries’ accounting records without said accounting firm or service bureau agreeing to provide Lender information regarding Borrower’s and its Subsidiaries’ financial condition.

7.12 Investments. Except for Permitted Investments, directly or indirectly, make or acquire any Investment or incur any liabilities (including contingent obligations) for or in connection with any Investment; provided, however, that Borrower and its Subsidiaries shall not have Permitted Investments (other than in the Cash Management Accounts) in Deposit Accounts or Securities Accounts in an aggregate amount in excess of $25,000 at any one time unless Borrower or its Subsidiary, as applicable, and the applicable securities intermediary or bank have entered into Control Agreements governing such Permitted Investments in order to perfect (and further establish) the Lender’s Liens in such Permitted Investments. Subject to the foregoing proviso, Borrower shall not and shall not permit its Subsidiaries to establish or maintain any Deposit Account or Securities Account unless Lender shall have received a Control Agreement in respect of such Deposit Account or Securities Account.

7.13 Transactions with Affiliates. Directly or indirectly enter into or permit to exist any transaction with any Affiliate of Borrower except for transactions that (a) are in the ordinary course of Borrower’s business, (b) are upon fair and reasonable terms, and (c) are no less favorable to Borrower or its Subsidiaries, as applicable, than would be obtained in an arm’s length transaction with a non-Affiliate.

7.14 Suspension. Suspend or go out of a substantial portion of its or their business.

7.15 [Intentionally omitted.]

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7.16 Use of Proceeds. Use the proceeds of the Advances for any purpose other than (a) on the Restatement Effective Date, to repay the Existing Term Loan and to pay transactional fees, costs, and expenses incurred in connection with this Agreement, the other Loan Documents, and the transactions contemplated hereby and thereby, and (b) thereafter, to purchase Eligible Equipment, finance general corporate expenses and to use in any other manner consistent with the terms and conditions hereof, for its lawful and permitted purposes.

7.17 [Intentionally omitted.]

7.18 Financial Covenants.

(a) Fail to maintain or achieve:

(i) Leverage Ratio. a Leverage Ratio, measured on a quarter-end basis for the twelve month period ending March 31, 2013 or any twelve month period ending as of the last day of any fiscal quarter thereafter, that is less than or equal to 2.0:1.00.

(ii) Minimum Revenue. Gross revenue for Borrower and its Subsidiaries calculated on a consolidated basis in accordance with GAAP (except that discounts, coupons and trade-ins shall be excluded from such calculation) of at least the required amount set forth in the following table for the applicable period set forth opposite thereto:

Applicable Amount		Period
$	4,687,000	For the 3 month period ending June 30, 2011
$	5,426,000	For the 3 month period ending September 30, 2011
$	6,783,000	For the 3 month period Ending December 31, 2011
$	7,732,000	For the 3 month period ending March 31, 2012
$	8,601,000	For the 3 month period ending June 30, 2012
$	9,362,000	For the 3 month period ending September 30, 2012
$	10,567,000	For the 3 month period Ending December 31, 2012

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(iii) Minimum Installed Stores. At least the number of Installed Stores set forth below in following chart as of the measurement date set forth opposite thereto:

Minimum Number of Installed Stores	Measurement Date
400 plus the number of Existing Installed Stores	June 30, 2011
700 plus the number of Existing Installed Stores	September 30, 2011
1000 plus the number of Existing Installed Stores	December 31, 2011
1300 plus the number of Existing Installed Stores	March 31, 2011
1600 plus the number of Existing Installed Stores	June 30, 2012
1900 plus the number of Existing Installed Stores	September 30, 2012
2200 plus the number of Existing Installed Stores	December 31, 2012

8. EVENTS OF DEFAULT.

Any one or more of the following events shall constitute an event of default (each, an “Event of Default”) under this Agreement:

8.1 If Borrower fails to pay when due and payable, or when declared due and payable, (a) all or any portion of the Obligations consisting of the reimbursement of Lender Expenses (other than any portion thereof constituting principal, fees or interest) constituting Obligations (including any portion thereof that accrues after the commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding), and such failure continues for a period of 10 days, (b) all or any portion of the Obligations consisting of principal, or (c) any interest or other amounts that do not constitute Lender Expenses (including any portion thereof that accrues after the commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding) and such failure continues for a period of five days;

8.2 If Borrower or any of its Subsidiaries:

(a) fails to perform or observe any covenant or other agreement contained in any of (i) Sections 6.2, 6.3, 6.8, 6.12, 6.15, or 6.16 of this Agreement, or (ii) Sections 7.1 through 7.18 of this Agreement; or

(b) fails to perform or observe any covenant or other agreement contained in this Agreement, or in any of the other Loan Documents, in each case, other than any such covenant or agreement that is the subject of another provision of this Section 8 (in which event such other provision of this Section 8 shall govern), and such failure continues for a period of 30 days after the earlier of (i) the date on which such failure shall first become known to any officer of Borrower or (ii) the date on which written notice thereof is given to Borrower by Lender;

8.3 If any material portion of Borrower’s or any of its Subsidiaries’ assets is attached, seized, subjected to a writ or distress warrant or levied upon;

8.4 If an Insolvency Proceeding is commenced by Borrower or any of its Subsidiaries;

8.5 If an Insolvency Proceeding is commenced against Borrower, or any of its Subsidiaries, and any of the following events occur: (a) Borrower or such Subsidiary consents to the institution of such

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Insolvency Proceeding against it, (b) the petition commencing the Insolvency Proceeding is not timely controverted, (c) the petition commencing the Insolvency Proceeding is not dismissed within 45 calendar days of the date of the filing thereof, (d) an interim trustee is appointed to take possession of all or any substantial portion of the properties or assets of, or to operate all or any substantial portion of the business of, Borrower or any of its Subsidiaries, or (e) an order for relief shall have been entered therein;

8.6 If Borrower or any of its Subsidiaries is enjoined, restrained, or in any way prevented by court order from continuing to conduct all or any material part of its business affairs;

8.7 If a notice of Lien, levy, or assessment is filed of record involving an amount of the Applicable Cross-Default Amount or more with respect to any of Borrower’s or any of its Subsidiaries’ assets by the United States, or any department, agency, or instrumentality thereof, or by any state, county, municipal, or governmental agency, or if any taxes or debts owing at any time hereafter to any one or more of such entities becomes a Lien, whether choate or otherwise, upon any of Borrower’s or any of its Subsidiaries’ assets and the same is not paid before such payment is delinquent;

8.8 If a judgment or other claim becomes a Lien or encumbrance involving an amount of the Applicable Cross-Default Amount or more upon any material portion of Borrower’s or any of its Subsidiaries’ assets;

8.9 If there is a default in any material agreement to which Borrower or any of its Subsidiaries is a party involving an amount of the Applicable Cross-Default Amount or more and such default (a) occurs at the final maturity of the obligations thereunder, or (b) results in a right by the other party thereto, irrespective of whether exercised, to accelerate the maturity of Borrower’s or its Subsidiaries’ obligations thereunder or to terminate such agreement;

8.10 If Borrower or any of its Subsidiaries makes any payment on account of Indebtedness that has been contractually subordinated in right of payment to the payment of the Obligations (other than reimbursement of a de minimis amount of expenses), except to the extent such payment is permitted by the terms of the subordination provisions applicable to such Indebtedness;

8.11 If any warranty, representation, certificate, statement, or Record made herein or in any other Loan Document or delivered in writing to Lender in connection with this Agreement or any other Loan Document proves to be untrue in any material respect (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) as of the date of issuance or making or deemed making thereof;

8.12 If the obligation of any Guarantor under any Guaranty (if any) is limited or terminated by operation of law or by any such Guarantor thereunder;

8.13 If this Agreement or any other Loan Document that purports to create a Lien, shall, for any reason, fail or cease to create a valid and perfected and, except to the extent permitted by the terms hereof or thereof, first priority Lien on or security interest in the Collateral covered hereby or thereby, except as a result of a disposition of the applicable Collateral in a transaction permitted under this Agreement; or

8.14 Any provision of any Loan Document shall at any time for any reason be declared to be null and void, or the validity or enforceability thereof shall be contested by Borrower or its Subsidiaries, or a proceeding shall be commenced by Borrower or its Subsidiaries, or by any Governmental Authority having jurisdiction over Borrower or its Subsidiaries seeking to establish the invalidity or unenforceability thereof, or Borrower or its Subsidiaries, shall deny that Borrower or its Subsidiaries has any liability or obligation purported to be created under any Loan Document.

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9. LENDER’S RIGHTS AND REMEDIES.

9.1 Rights and Remedies. Upon the occurrence, and during the continuation, of an Event of Default, Lender (at its election but without notice of its election and without demand) may do any one or more of the following, all of which are authorized by Borrower:

(a) Declare all or any portion of the Obligations, whether evidenced by this Agreement, by any of the other Loan Documents, or otherwise, immediately due and payable;

(b) Cease advancing money or extending credit to or for the benefit of Borrower under this Agreement, under any of the Loan Documents, or under any other agreement between Borrower and Lender;

(c) Terminate this Agreement and any of the other Loan Documents as to any future liability or obligation of Lender, but without affecting any of the Lender’s Liens in the Collateral and without affecting the Obligations;

(d) Settle or adjust disputes and claims directly with Borrower’s Account Debtors for amounts and upon terms which Lender considers advisable, and in such cases, Lender will credit Borrower’s Loan Account with only the net amounts received by Lender in payment of such disputed Accounts after deducting all Lender Expenses incurred or expended in connection therewith;

(e) Cause Borrower to hold all of its returned Inventory in trust for Lender and segregate all such Inventory from all other assets of Borrower or in Borrower’s possession;

(f) Without notice to or demand upon Borrower, make such payments and do such acts as Lender considers necessary or reasonable to protect its security interests in the Collateral. Borrower agrees to assemble the Collateral if Lender so requires, and to make the Collateral available to Lender at a place that Lender may designate which is reasonably convenient to both parties. Borrower authorizes Lender to enter the premises where the Collateral is located, to take and maintain possession of the Collateral, or any part of it, and to pay, purchase, contest, or compromise any Lien that in Lender’s determination appears to conflict with the priority of Lender’s Liens in and to the Collateral and to pay all expenses incurred in connection therewith and to charge Borrower’s Loan Account therefor. With respect to any of Borrower’s owned or leased premises, Borrower hereby grants Lender a license to enter into possession of such premises and to occupy the same, without charge, in order to exercise any of Lender’s rights or remedies provided herein, at law, in equity, or otherwise;

(g) Without notice to Borrower (such notice being expressly waived), and without constituting an acceptance of any collateral in full or partial satisfaction of an obligation (within the meaning of the Code), set off and apply to the Obligations any and all (i) balances and deposits of Borrower held by Lender (including any amounts received in the Cash Management Accounts), or (ii) Indebtedness at any time owing to or for the credit or the account of Borrower held by Lender;

(h) Hold, as cash collateral, any and all balances and deposits of Borrower held by Lender, and any amounts received in the Cash Management Accounts, to secure the full and final repayment of all of the Obligations;

(i) Ship, reclaim, recover, store, finish, maintain, repair, prepare for sale, advertise for sale, and sell (in the manner provided for herein) the Borrower Collateral. Borrower hereby grants to Lender a license or other right to use, without charge, Borrower’s labels, patents, copyrights, trade secrets, trade names, trademarks, service marks, and advertising matter, or any property of a similar nature, as it pertains to the Borrower Collateral, in completing production of, advertising for sale, and selling any Borrower Collateral and Borrower’s rights under all licenses and all franchise agreements shall inure to Lender’s benefit;

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(j) Sell the Borrower Collateral at either a public or private sale, or both, by way of one or more contracts or transactions, for cash or on terms, in such manner and at such places (including Borrower’s premises) as Lender determines is commercially reasonable. It is not necessary that the Borrower Collateral be present at any such sale;

(k) Except in those circumstances where no notice is required under the Code, Lender shall give notice of the disposition of the Borrower Collateral as follows:

(i) Lender shall give Borrower a notice in writing of the time and place of public sale, or, if the sale is a private sale or some other disposition other than a public sale is to be made of the Borrower Collateral, the time on or after which the private sale or other disposition is to be made; and

(ii) The notice shall be personally delivered or mailed, postage prepaid, to Borrower as provided in Section 12, at least 10 days before the earliest time of disposition set forth in the notice; no notice needs to be given prior to the disposition of any portion of the Borrower Collateral that is perishable or threatens to decline speedily in value or that is of a type customarily sold on a recognized market;

(l) Lender may credit bid and purchase at any public sale;

(m) Lender may seek the appointment of a receiver or keeper to take possession of all or any portion of the Borrower Collateral or to operate same and, to the maximum extent permitted by law, may seek the appointment of such a receiver without the requirement of prior notice or a hearing; and

(n) Lender shall have all other rights and remedies available at law or in equity or pursuant to any other Loan Document.

The foregoing to the contrary notwithstanding, upon the occurrence of any Event of Default described in Section 8.4 or Section 8.5, in addition to the remedies set forth above, without any notice to Borrower or any other Person or any act by the Lender, Lender’s obligation to extent credit hereunder shall terminated and the Obligations then outstanding, together with all accrued and unpaid interest thereon and all fees and all other amounts due under this Agreement and the other Loan Documents, shall automatically and immediately become due and payable, without presentment, demand, protest, or notice of any kind, all of which are expressly waived by Borrower.

9.2 Remedies Cumulative. The rights and remedies of Lender under this Agreement, the other Loan Documents, and all other agreements shall be cumulative. Lender shall have all other rights and remedies not inconsistent herewith as provided under the Code, by law, or in equity. No exercise by Lender of one right or remedy shall be deemed an election, and no waiver by Lender of any Event of Default shall be deemed a continuing waiver. No delay by Lender shall constitute a waiver, election, or acquiescence by it.

10. TAXES AND EXPENSES.

If Borrower fails to pay any monies (whether taxes, assessments, insurance premiums, or, in the case of leased properties or assets, rents or other amounts payable under such leases) due to third Persons, or fails to make any deposits or furnish any required proof of payment or deposit, all as required under the terms of this Agreement, then, Lender, in its sole discretion and without prior notice to Borrower, may do any or all of the following: (a) make payment of the same or any part thereof, (b) set up such reserves against the Maximum Revolver Amount as Lender deems necessary to protect Lender from the exposure created by such failure, or (c) in the case of the failure to comply with Section 6.7 hereof, obtain and maintain insurance policies of the type described in Section 6.7 and take any action with respect to such policies as Lender deems prudent. Any such amounts paid by Lender shall constitute Lender Expenses and any such payments shall not constitute an agreement by Lender to make similar payments in the future or a waiver by Lender of any Event of Default under this Agreement. Lender need not inquire as to, or contest the validity of, any such expense, tax, or Lien and the receipt of the usual official notice for the payment thereof shall be conclusive evidence that the same was validly due and owing.

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11. WAIVERS; INDEMNIFICATION.

11.1 Demand; Protest. Borrower waives demand, protest, notice of protest, notice of default or dishonor, notice of payment and nonpayment, nonpayment at maturity, release, compromise, settlement, extension, or renewal of documents, instruments, chattel paper, and guarantees at any time held by Lender on which Borrower may in any way be liable.

11.2 Lender’s Liability for Borrower Collateral. Borrower hereby agrees that: (a) so long as Lender complies with its obligations, if any, under the Code, Lender shall not in any way or manner be liable or responsible for: (i) the safekeeping of the Borrower Collateral, (ii) any loss or damage thereto occurring or arising in any manner or fashion from any cause, (iii) any diminution in the value thereof, or (iv) any act or default of any carrier, warehouseman, bailee, forwarding agency, or other Person, and (b) all risk of loss, damage, or destruction of the Borrower Collateral shall be borne by Borrower.

11.3 Indemnification. Borrower shall pay, indemnify, defend, and hold the Lender-Related Persons, and each Participant (each, an “Indemnified Person”) harmless (to the fullest extent permitted by law) from and against any and all claims, demands, suits, actions, investigations, proceedings, and damages, and all reasonable attorneys fees and disbursements and other costs and expenses actually incurred in connection therewith or in connection with the enforcement of this indemnification (as and when they are incurred and irrespective of whether suit is brought), at any time asserted against, imposed upon, or incurred by any of them (a) in connection with or as a result of or related to the execution, delivery, enforcement, performance, or administration (including any restructuring or workout with respect hereto) of this Agreement, any of the other Loan Documents, or the transactions contemplated hereby or thereby or the monitoring of Borrower’s and its Subsidiaries’ compliance with the terms of the Loan Documents, and (b) with respect to any investigation, litigation, or proceeding related to this Agreement, any other Loan Document, or the use of the proceeds of the credit provided hereunder (irrespective of whether any Indemnified Person is a party thereto), or any act, omission, event, or circumstance in any manner related thereto (all the foregoing, collectively, the “Indemnified Liabilities”). The foregoing to the contrary notwithstanding, Borrower shall have no obligation to any Indemnified Person under this Section 11.3 with respect to any Indemnified Liability has resulted from the gross negligence or willful misconduct of such Indemnified Person. This provision shall survive the termination of this Agreement and the repayment of the Obligations. If any Indemnified Person makes any payment to any other Indemnified Person with respect to an Indemnified Liability as to which Borrower was required to indemnify the Indemnified Person receiving such payment, the Indemnified Person making such payment is entitled to be indemnified and reimbursed by Borrower with respect thereto. WITHOUT LIMITATION, THE FOREGOING INDEMNITY SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO INDEMNIFIED LIABILITIES WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF ANY NEGLIGENT ACT OR OMISSION OF SUCH INDEMNIFIED PERSON OR OF ANY OTHER PERSON.

12. NOTICES.

Unless otherwise provided in this Agreement, all notices or demands by Borrower or Lender to the other relating to this Agreement or any other Loan Document shall be in writing and (except for financial statements and other informational documents which may be sent by first-class mail, postage prepaid) shall be personally delivered or sent by registered or certified mail (postage prepaid, return receipt requested), overnight courier, electronic mail (at such email addresses as Borrower or Lender, as applicable, may designate to each other in accordance herewith), or telefacsimile to Borrower or Lender, as the case may be, at its address set forth below:

If to Borrower:	PROFESSOR CONNOR’S, INC.
	DBA: FRESHPET
	400 Plaza Drive FL1
	Secaucus, NJ 07094
	Attn: Richard Kassar
	Fax No. (201) 866-2018

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with copies to:	DLA PIPER RUDNICK GRAY CARY US LLP
	1251 Avenue of the Americas
	New York, NY 10020
	Attn: John Edwin Depke, Esq.
	Fax No. (212) 884-8531
If to Lender:	CITY NATIONAL BANK
	555 S. Flower Street
	16th Floor
	Los Angeles, California 90071
	Attn: Aaron Cohen
	Fax No.: (213) 673-9801
with copies to:	PAUL, HASTINGS, JANOFSKY & WALKER LLP
	515 South Flower Street
	Twenty-Fifth Floor
	Los Angeles, California 90071
	Attention: John Francis Hilson
	Facsimile: 213-996-3300

Lender and Borrower may change the address at which they are to receive notices hereunder, by notice in writing in the foregoing manner given to the other party. All notices or demands sent in accordance with this Section 12, other than notices by Lender in connection with enforcement rights against the Borrower Collateral under the provisions of the Code, shall be deemed received on the earlier of the date of actual receipt or 3 Business Days after the deposit thereof in the mail. Borrower acknowledges and agrees that notices sent by Lender in connection with the exercise of enforcement rights against Borrower Collateral under the provisions of the Code shall be deemed sent when deposited in the mail or personally delivered, or, where permitted by law, transmitted by telefacsimile or any other method set forth above.

13. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

(a) THE VALIDITY OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (UNLESS EXPRESSLY PROVIDED TO THE CONTRARY IN ANOTHER LOAN DOCUMENT IN RESPECT OF SUCH OTHER LOAN DOCUMENT), THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES HERETO AND THERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR THEREUNDER OR RELATED HERETO OR THERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

(b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND, TO THE EXTENT PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT LENDER’S OPTION, IN THE COURTS OF ANY JURISDICTION WHERE LENDER ELECTS TO BRING

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SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. BORROWER AND LENDER WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 13(b).

(c) BORROWER AND LENDER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. BORROWER AND LENDER REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

14. ASSIGNMENTS AND PARTICIPATIONS; SUCCESSORS.

14.1 Assignments and Participations.

(a) Lender may assign and delegate to one or more assignees (each an “Assignee”) all or any ratable part of all, of the Obligations and the other rights and obligations of Lender hereunder and under the other Loan Documents, in a minimum amount of $1,000,000; provided, however, that (x) so long as no Default or Event of Default has occurred and is continuing, Lender shall obtain the prior written consent of Borrower (not to be unreasonably withheld, delayed or conditioned) prior to any such assignment by Lender to another Person that is not an Affiliate of Lender, and (y) Borrower may continue to deal solely and directly with Lender in connection with the interest so assigned to an Assignee until (i) written notice of such assignment, together with payment instructions, addresses, and related information with respect to the Assignee, have been given to Borrower by Lender and the Assignee, and (ii) Lender and its Assignee have delivered to Borrower an assignment and acceptance. Anything contained herein to the contrary notwithstanding, the Assignee need not be an Eligible Transferee if such assignment is in connection with any merger, consolidation, sale, transfer, or other disposition of all or any substantial portion of the business or loan portfolio of the assigning Lender.

(b) From and after the date that Lender provides Borrower with such written notice and executed assignment and acceptance, (i) the Assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such assignment and acceptance, shall have the rights and obligations of a Lender under the Loan Documents, and (ii) the Lender shall, to the extent that rights and obligations hereunder and under the other Loan Documents have been assigned by it pursuant to such assignment and acceptance, relinquish its rights (except with respect to Section 11.3 hereof) and be released from any future obligations under this Agreement (and in the case of an assignment and acceptance covering all or the remaining portion of an assigning Lender’s rights and obligations under this Agreement and the other Loan Documents, such Lender shall cease to be a party hereto and thereto), and such assignment shall effect a novation between Borrower and the Assignee; provided, however, that nothing contained herein shall release any assigning Lender from obligations that survive the termination of this Agreement, including such assigning Lender’s obligations under Section 16.9 of this Agreement.

(c) Immediately upon Borrower’s receipt of such fully executed assignment and acceptance agreement, this Agreement shall be deemed to be amended to the extent, but only to the extent, necessary to reflect the addition of the Assignee and the resulting adjustment of the rights and duties of Lender arising therefrom.

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(d) Lender may at any time sell to one or more commercial banks, financial institutions, or other Persons not Affiliates of Lender (a “Participant”) participating interests in Obligations and the other rights and interests of Lender hereunder and under the other Loan Documents; provided, however, that (i) Lender shall remain the “Lender” for all purposes of this Agreement and the other Loan Documents and the Participant receiving the participating interest in the Obligations and the other rights and interests of Lender hereunder shall not constitute a “Lender” hereunder or under the other Loan Documents and Lender’s obligations under this Agreement shall remain unchanged, (ii) Lender shall remain solely responsible for the performance of such obligations, (iii) Borrower and Lender shall continue to deal solely and directly with each other in connection with Lender’s rights and obligations under this Agreement and the other Loan Documents, (iv) Lender shall not transfer or grant any participating interest under which the Participant has the right to approve any amendment to, or any consent or waiver with respect to, this Agreement or any other Loan Document, except to the extent such amendment to, or consent or waiver with respect to this Agreement or of any other Loan Document would (A) extend the final maturity date of the Obligations hereunder in which such Participant is participating, (B) reduce the interest rate applicable to the Obligations hereunder in which such Participant is participating, (C) release all or substantially all of the Collateral or guaranties (except to the extent expressly provided herein or in any of the Loan Documents) supporting the Obligations hereunder in which such Participant is participating, (D) postpone the payment of, or reduce the amount of, the interest or fees payable to such Participant through Lender, or (E) change the amount or due dates of scheduled principal repayments or prepayments or premiums, and (v) all amounts payable by Borrower hereunder shall be determined as if Lender had not sold such participation, except that, if amounts outstanding under this Agreement are due and unpaid, or shall have been declared or shall have become due and payable upon the occurrence of an Event of Default, each Participant shall be deemed to have the right of set-off in respect of its participating interest in amounts owing under this Agreement to the same extent as if the amount of its participating interest were owing directly to it as a Lender under this Agreement. The rights of any Participant only shall be derivative through Lender and no Participant shall have any rights under this Agreement or the other Loan Documents or any direct rights as to Borrower, the Collections of Borrower or its Subsidiaries, the Collateral, or otherwise in respect of the Obligations. No Participant shall have the right to participate directly in the making of decisions by Lender.

(e) In connection with any such assignment or participation or proposed assignment or participation, Lender may, subject to the provisions of Section 16.9, disclose all documents and information which it now or hereafter may have relating to Borrower and its Subsidiaries and their respective businesses.

(f) Any other provision in this Agreement notwithstanding, Lender may at any time create a security interest in, or pledge, all or any portion of its rights under and interest in this Agreement in favor of any Federal Reserve Bank in accordance with Regulation A of the Federal Reserve Bank or U.S. Treasury Regulation 31 CFR § 203.24, and such Federal Reserve Bank may enforce such pledge or security interest in any manner permitted under applicable law.

14.2 Successors. This Agreement shall bind and inure to the benefit of the respective successors and assigns of each of the parties; provided, however, that Borrower may not assign this Agreement or any rights or duties hereunder without Lender’s prior written consent and any prohibited assignment shall be absolutely void ab initio. No consent to assignment by Lender shall release Borrower from its Obligations. Lender may assign this Agreement and the other Loan Documents and its rights and duties hereunder and thereunder pursuant to Section 14.1 hereof and, except as expressly required pursuant to Section 14.1 hereof, no consent or approval by Borrower is required in connection with any such assignment.

15. AMENDMENTS; WAIVERS.

15.1 Amendments and Waivers. No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent with respect to any departure by Borrower therefrom, shall be effective unless the same shall be in writing and signed by Lender and Borrower and then any such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

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15.2 No Waivers; Cumulative Remedies. No failure by Lender to exercise any right, remedy, or option under this Agreement or any other Loan Document, or delay by Lender in exercising the same, will operate as a waiver thereof. No waiver by Lender will be effective unless it is in writing, and then only to the extent specifically stated. No waiver by Lender on any occasion shall affect or diminish Lender’s rights thereafter to require strict performance by Borrower of any provision of this Agreement. Lender’s rights under this Agreement and the other Loan Documents will be cumulative and not exclusive of any other right or remedy that Lender may have.

16. GENERAL PROVISIONS.

16.1 Effectiveness. This Agreement shall be binding and deemed effective when executed by Borrower and Lender.

16.2 Section Headings. Headings and numbers have been set forth herein for convenience only. Unless the contrary is compelled by the context, everything contained in each Section applies equally to this entire Agreement.

16.3 Interpretation. Neither this Agreement nor any uncertainty or ambiguity herein shall be construed against Lender or Borrower, whether under any rule of construction or otherwise. On the contrary, this Agreement has been reviewed by all parties and shall be construed and interpreted according to the ordinary meaning of the words used so as to accomplish fairly the purposes and intentions of all parties hereto.

16.4 Severability of Provisions. Each provision of this Agreement shall be severable from every other provision of this Agreement for the purpose of determining the legal enforceability of any specific provision.

16.5 Withholding Taxes.

(a) All payments made by Borrower hereunder or under any note or other Loan Document will be made without setoff, counterclaim, or other defense. In addition, all such payments will be made free and clear of, and without deduction or withholding for, any present or future Taxes, and in the event any deduction or withholding of Taxes is required, Borrower shall comply with the penultimate sentence of this Section 16.5, “Taxes” shall mean, any taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed by any jurisdiction or by any political subdivision or taxing authority thereof or therein with respect to such payments (but excluding, any tax imposed by any jurisdiction or by any political subdivision or taxing authority thereof or therein measured by or based on the net income or net profits of Lender) and all interest, penalties or similar liabilities with respect thereto. If any Taxes are so levied or imposed, Borrower agrees to pay the full amount of such Taxes, and such additional amounts as may be necessary so that every payment of all amounts due under this Agreement, any note, or Loan Document, including any amount paid pursuant to this Section 16.5 after withholding or deduction for or on account of any Taxes, will not be less than the amount provided for herein; provided, however, that Borrower shall not be required to increase any such amounts if the increase in such amount payable results from Lender’s own willful misconduct or gross negligence (as finally determined by a court of competent jurisdiction); and provided further that Borrower shall not be required to increase any such amounts if the increase in such amounts payable is or pertains to (i) any withholding tax (including backup withholding tax) that is attributable to such person’s failure to comply with Section 16.5(b), (ii) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which any “lender” (including, to the extent applicable, and for purposes of this Section 16.5 only, an Assignee or Participant) is located, (iii) in the case of a foreign lender, any withholding tax that (x) is imposed on amounts payable to such foreign lender at the time such foreign lender becomes a party to this Agreement, (y) is imposed on amounts payable to such foreign lender as a result or consequences of the foreign lender designating a new lending office, or (z) is attributable to such Foreign Lender’s failure to comply with Section 16.5(c). Borrower will furnish to Lender as promptly as possible after the date the payment of any Tax is due pursuant to applicable law certified copies of tax receipts evidencing such payment by Borrower.

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(b) Each lender that is not a foreign lender (each such Lender, a “U.S. Lender”) and which is not an “exempt recipient” within the meaning of the Treasury Regulation Section 1.6049-4(c)(1)(ii) and (A) is a party hereto on the closing date or (B) becomes an Assignee or Participant of any interest under this Agreement shall (w) on or prior to the date such U.S. Lender becomes a party hereunder, (x) on or prior to the date on which any such form or certification expires or becomes obsolete, (y) after the occurrence of any event requiring a change in the most recent form or certification previously delivered by it, and (z) from time to time if requested by Borrower, provide Borrower with two completed originals of Form W-9 (certifying that such U.S. Lender is entitled to an exemption from U.S. backup withholding tax) or any successor form.

(c) Any foreign lender that is entitled to an exemption from or reduction of withholding tax under the IRC or any treaty to which the United States is a party, with respect to payments under this Agreement shall deliver to the Borrower, at the time or times prescribed by applicable law, such properly completed and executed documentation prescribed by applicable law or reasonably requested by the Borrower as will permit such payments to be made without withholding or at a reduced rate. Without limiting the generality of the foregoing, each foreign lender agrees that it will deliver to the Borrower (or in the case of a Participant, to the lender from which the related participation shall have been purchased), as appropriate, two (2) duly completed copies of (i) Internal Revenue Service Form W-8 ECI, or any successor form thereto, certifying that the payments received from the Borrower hereunder are effectively connected with such foreign lender’s conduct of a trade or business in the United States; or (ii) Internal Revenue Service Form W-8 BEN, or any successor form thereto, certifying that such foreign lender is entitled to benefits under an income tax treaty to which the United States is a party which reduces the rate of withholding tax on payments of interest; or (iii) Internal Revenue Service Form W-8 BEN, or any successor form prescribed by the Internal Revenue Service, together with a certificate (A) establishing that the payment to the foreign lender qualifies as “portfolio interest” exempt from U.S. withholding tax under Code section 871(h) or 881(c), and (B) stating that (1) the foreign lender is not a bank for purposes of Code section 881(c)(3)(A), or the obligation of the Borrower hereunder is not, with respect to such foreign lender, a loan agreement entered into in the ordinary course of its trade or business, within the meaning of that section; (2) the foreign lender is not a 10% shareholder of the Borrower within the meaning of Code section 871(h)(3) or 881(c)(3)(B); and (3) the foreign lender is not a controlled foreign corporation that is related to the Borrower within the meaning of Code section 881(c)(3)(C); or (iv) such other Internal Revenue Service forms as may be applicable to the foreign lender, including Forms W-8 IMY or W-8 EXP. Each such foreign lender shall deliver to the Borrower such forms on or before the date that it becomes a party to this Agreement (or in the case of a Participant, on or before the date such Participant purchases the related participation). In addition, each such foreign lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such foreign lender. Each such foreign lender shall promptly notify the Borrower and Lender at any time that it determines that it is no longer in a position to provide any previously delivered certificate to the Borrower (or any other form of certification adopted by the Internal Revenue Service for such purpose).

16.6 Counterparts; Electronic Execution. This Agreement may be executed in any number of counterparts and by different parties on separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute but one and the same Agreement. Delivery of an executed counterpart of this Agreement by telefacsimile or other electronic method of transmission shall be equally as effective as delivery of an original executed counterpart of this Agreement. Any party delivering an executed counterpart of this Agreement by telefacsimile or other electronic method of transmission also shall deliver an original executed counterpart of this Agreement but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Agreement. The foregoing shall apply to each other Loan Document mutatis mutandis.

16.7 Revival and Reinstatement of Obligations. If the incurrence or payment of the Obligations by Borrower or Guarantor or the transfer to Lender of any property should for any reason subsequently be

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declared to be void or voidable under any state or federal law relating to creditors’ rights, including provisions of the Bankruptcy Code relating to fraudulent conveyances, preferences, or other voidable or recoverable payments of money or transfers of property (collectively, a “Voidable Transfer”), and if Lender is required to repay or restore, in whole or in part, any such Voidable Transfer, or elects to do so upon the reasonable advice of its counsel, then, as to any such Voidable Transfer, or the amount thereof that Lender is required or elects to repay or restore, and as to all reasonable costs, expenses, and attorneys fees of Lender related thereto, the liability of Borrower or Guarantor automatically shall be revived, reinstated, and restored and shall exist as though such Voidable Transfer had never been made.

16.8 Confidentiality.

Lender agrees that material, non-public information regarding Borrower and its Subsidiaries, their operations, assets, and existing and contemplated business plans shall be treated by Lender in a confidential manner, and shall not be disclosed by Lender to Persons who are not parties to this Agreement, except: (a) to attorneys for and other advisors, accountants, auditors, and consultants to Lender, (b) to Subsidiaries and Affiliates of Lender, provided that any such Subsidiary or Affiliate shall have agreed to receive such information hereunder subject to the terms of this Section 16.8, (c) as may be required by statute, decision, or judicial or administrative order, rule, or regulation, (d) as may be agreed to in advance by Borrower or its Subsidiaries or as requested or required by any Governmental Authority pursuant to any subpoena or other legal process, (e) as to any such information that is or becomes generally available to the public (other than as a result of prohibited disclosure by Lender), (f) in connection with any permitted assignment, prospective assignment, sale, prospective sale, participation or prospective participations, or pledge or prospective pledge of Lender’s interest under this Agreement, provided that any such assignee, prospective assignee, purchaser, prospective purchaser, participant, prospective participant, pledgee, or prospective pledgee shall have agreed in writing to receive such information hereunder subject to the terms of this Section, and (g) in connection with any litigation or other adversary proceeding involving parties hereto which such litigation or adversary proceeding involves claims related to the rights or duties of such parties under this Agreement or the other Loan Documents. The provisions of this Section 16.8 shall survive for 2 years after the payment in full of the Obligations.

16.9 Integration. This Agreement, together with the other Loan Documents, reflects the entire understanding of the parties with respect to the transactions contemplated hereby and shall not be contradicted or qualified by any other agreement, oral or written, before the date hereof.

16.10 Waiver of Designated Events of Default. Anything in the this Agreement or the Original Agreement to the contrary notwithstanding, and subject to the satisfaction or waiver of the conditions precedent set forth in Section 3 hereof, Lender hereby (a) waives the Designated Events of Default; provided, however, nothing herein, nor any communications among Borrower, any Guarantor, or Lender, shall be deemed a waiver with respect to any Event of Default, other than the Designated Events of Default, or any future failure of Borrower or any Guarantor to comply fully with any provision of this Agreement or any provision of any other Loan Document, and in no event shall this waiver be deemed to be a waiver of enforcement of any of Lender’s rights or remedies under this Agreement and the other Loan Documents, at law (including under the Code), in equity, or otherwise including, without limitation, the right to declare all Obligations immediately due and payable pursuant to Section 9.1, with respect to any other Defaults or Events of Default now existing or hereafter arising. Except as expressly provided herein, Lender hereby reserves and preserves all of its rights and remedies against Borrower and any Guarantor under this Agreement and the other Loan Documents, at law (including under the Code), in equity, or otherwise including, without limitation, the right to declare all Obligations immediately due and payable pursuant to Section 9.1.

16.11 No Novation. This Agreement does not extinguish the obligations for the payment of money outstanding under the Original Loan Agreement or discharge or release the obligations or the liens or priority of any mortgage, pledge, security agreement or any other security therefor. Nothing herein contained shall be construed as a substitution or novation of the obligations outstanding under the Original Loan Agreement, the

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other Loan Documents or instruments securing the same, which shall remain in full force and effect, except as modified hereby or by instruments executed concurrently herewith. Nothing expressed or implied in this Agreement shall be construed as a release or other discharge of Borrower or any Guarantor from any of its obligations or liabilities under the Original Loan Agreement or any of the security agreements, pledge agreements, mortgages, guaranties or other loan documents executed in connection therewith. Borrower hereby (a) confirms and agrees that each Loan Document to which it is a party that was executed prior to the date hereof and that is not being amended and restated concurrently herewith is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects except that on and after the Restatement Effective Date, all references in any such Loan Document to “the Loan Agreement,” “thereto,” “thereof,” “thereunder” or words of like import referring to the Original Loan Agreement shall mean the Original Loan Agreement as amended and restated by this Agreement; and (b) confirms and agrees that to the extent that any Loan Document (including this Agreement) purports to assign or pledge to the Lender or to grant to the Lender a security interest in or lien on, any collateral as security for the obligations of Borrower or any other Loan Party, as the case may be, from time to time existing in respect of the Original Loan Agreement or the Loan Documents, such pledge or assignment or grant of the security interest or lien is hereby ratified and confirmed in all respects with respect to this Agreement and the Loan Documents.

[Signature pages to follow.]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered as of the date first above written.

PROFESSOR CONNOR’S, INC.,
A Delaware corporation, as Borrower
By:
Title:	President

[SIGNATURE PAGE TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

CITY NATIONAL BANK,
a national banking association, as Lender
By:
Title:	Garen Papazyan
	Vice President

[SIGNATURE PAGE TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

EXHIBIT C-1

FORM OF COMPLIANCE CERTIFICATE

[on Borrower’s letterhead]

To: City National Bank

555 S. Flower Street

16th Floor

Los Angeles, CA 90071

Attention: Aaron Cohen

Re: Compliance Certificate dated                 

Ladies and Gentlemen:

Reference is made to that certain AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (the “Loan Agreement”), dated as of December 23, 2010, by and among PROFESSOR CONNOR’S, INC., a Delaware corporation (“Borrower”) and CITY NATIONAL BANK, a national banking association. Capitalized terms used herein shall have the meanings set forth in the Loan Agreement unless specifically defined herein.

Pursuant to Section 6.3 of the Loan Agreement, the undersigned chief financial officer of Borrower hereby certifies in his/her capacity as a chief financial officer of Borrower and not in his/her individual capacity that:

1. The financial information of Borrower and its Subsidiaries furnished in Schedule 1 attached hereto (the “Financial Statements”), has been prepared in accordance with GAAP (except for year-end adjustments and the lack of footnotes), and fairly presents in all material respects the consolidated financial condition of Borrower and its Subsidiaries as of the date thereof or the consolidated results of operations of Borrower and its Subsidiaries for the period then ended.

2. Such officer has reviewed the terms of the Loan Agreement and has made, or caused to be made under his/her supervision, a review in reasonable detail of the transactions and financial condition of Borrower and its Subsidiaries during the accounting period covered by the Financial Statements.

3. Such review has not disclosed the existence on and as of the date of the Financial Statements, and the undersigned does not have knowledge of the existence as of the date of the Financial Statements, of any event or condition that constituted a Default or Event of Default, except for such conditions or events listed on Schedule 2 attached hereto, specifying the nature and period of existence thereof and what action Borrower and its Subsidiaries have taken, are taking, or propose to take with respect thereto.

4. As of the date of the Financial Statements, Borrower and its Subsidiaries are in compliance with the applicable covenants contained in Section 7.18 of the Loan Agreement as demonstrated on Schedule 3 hereof.

5. The Leverage Ratio calculation set forth on Schedule 3 attached hereto is true and correct; provided, however, that such condition is only applicable to fiscal quarters ending on or after March 31, 2013.

IN WITNESS WHEREOF, this Compliance Certificate is executed by the undersigned this      day of             , 20    .

PROFESSOR CONNOR’S, INC.,
a Delaware corporation
By:
Name:
Title:	Chief Financial Officer

[SIGNATURE PAGE TO COMPLIANCE CERTIFICATE]

SCHEDULE 1

Financial Information

SCHEDULE 2

Default or Event of Default

SCHEDULE 3

Financial Covenants

1. Minimum Revenue.

Borrower’s and its Subsidiaries’ gross revenue, calculated on a consolidated basis in accordance with GAAP, for the 3 month period ending                  ,      is $        , which amount [is/is not] greater than the amount set forth in Section 7.18(a)(ii) of the Loan Agreement for the corresponding period.

2. Minimum Installed Stores.

Borrower maintains      Installed Stores, which [is/is not] equal to or greater than the number of Installed Stores as of the applicable measurement date as set forth in Section 7.18(a)(iii) of the Loan Agreement.

3. Leverage Ratio.

Borrower’s and its Subsidiaries’ Leverage Ratio, measured on a quarter-end basis for the twelve month period ending                  ,      is     :    .

EXHIBIT L-1

FORM OF LIBOR NOTICE

City National Bank

555 S. Flower Street

16th Floor

Los Angeles, CA 90071

Attention: Aaron Cohen

Ladies and Gentlemen:

Reference is made to that certain AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (the “Loan Agreement”), dated as of December 23, 2010, by and among PROFESSOR CONNOR’S, INC., a Delaware corporation (“Borrower”), and CITY NATIONAL BANK, a national banking association. Capitalized terms used herein shall have the meanings set forth in the Loan Agreement unless specifically defined herein.

This LIBOR Notice represents Borrower’s request to elect the LIBOR Option with respect to [all] [a portion of] the Advance in the amount of $         (the “LIBOR Rate Advance”)[, and is a written confirmation of the telephonic notice of such election given to Lender].

The LIBOR Rate Advance will have an Interest Period of [1, 2, 3] month(s) commencing on             .

Borrower represents and warrants that no Event of Default has occurred and is continuing on the date hereof, nor will any thereof occur after giving effect to the request above.

City National Bank, as Lender

Page 2

Borrower represents and warrants that as of the date hereof, (i) the representations and warranties contained the Loan Documents are true and correct in all material respects on and as of the date of such extension of credit, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date), (ii) no Default or Event of Default shall have occurred and be continuing on the date of such extension of credit, nor shall either result from the making thereof, (iii) no injunction, writ, restraining order, or other order of any nature restricting or prohibiting, directly or indirectly, the extending of such credit shall have been issued and remain in force by any Governmental Authority against Borrower, Lender, or any of their Affiliates, and (iv) no Material Adverse Change has occurred.

Dated:             , 20    

PROFESSOR CONNOR’S, INC.,

a Delaware corporation, as Borrower

By

Name:

Title:

Acknowledged by:

CITY NATIONAL BANK, a national banking association, as Lender

By:

Name:

Title:

EXHIBIT N-1

FORM OF NOTICE OF BORROWING

City National Bank

555 S. Flower Street

16th Floor

Los Angeles, CA 90071

Attention: Aaron Cohen

RE: Notice of Borrowing under the Amended and Restated Loan and Security Agreement, dated as of December 23, 2010 (the “Loan Agreement”), among Professor Connor’s, Inc., a Delaware corporation (the “Borrower”), and City National Bank, a national banking association (the “Lender”). Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement.

Ladies and Gentlemen:

Reference hereby is made to the Loan Agreement. Capitalized terms used herein, and not otherwise defined herein, have their respective meanings given them in the Loan Agreement.

Pursuant to Section 2.3 of the Loan Agreement, the Borrower hereby gives you irrevocable notice that the Borrower hereby requests an Advance under the Loan Agreement, and sets forth below the information relating to such proposed Advance (the “Proposed Borrowing”) as required by Section 2.3 of the Loan Agreement.

a. The Business Day of the Proposed Borrowing is             .

b. The amount of the Proposed Borrowing is $        .

c. The Proposed Borrowing will be an Advance.

d. The Proposed Borrowing will be a [Base Rate Loan][LIBOR Rate Loan] with an Interest period of [1][2][3] month(s).

e. The Proposed Borrowing is to be made pursuant to the instructions set forth on Exhibit A attached hereto.

The Borrower hereby further certifies that (i) as of the date hereof, (ii) as of the date for the Proposed Borrowing, and (iii) after giving effect to the Proposed Borrowing:

a. the representations and warranties contained the Loan Documents are true and correct in all material respects on and as of the date of such extension of credit, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date),

b. no Default or Event of Default shall have occurred and be continuing on the date of such extension of credit, nor shall either result from the making thereof,

c. no injunction, writ, restraining order, or other order of any nature restricting or prohibiting, directly or indirectly, the extending of such credit shall have been issued and remain in force by any Governmental Authority against Borrower, Lender, or any of their Affiliates, and

d. no Material Adverse Change has occurred.

Very truly yours,

PROFESSOR CONNOR’S, INC.,

a Delaware corporation

By:

Name:

Title:

EXHIBIT A

WIRING INSTRUCTIONS

Payee	Wiring Instructions
	Bank:
	[City/State]
	ABA #
	Account #
	Ref:

EXHIBIT B

EX-10.6

Exhibit 10.6

AMENDMENT NUMBER ONE TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

THIS AMENDMENT NUMBER ONE TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”), dated as of February 9, 2012 is entered into by and between PROFESSOR CONNOR’S, INC., a Delaware corporation (“Borrower”), and CITY NATIONAL BANK, a national banking association (“Lender”), and in light of the following:

W I T N E S S E T H

WHEREAS, Borrower and Lender are parties to that certain Amended and Restated Loan and Security Agreement, dated as of December 23, 2010 (as amended, restated, supplemented, or otherwise modified from time to time, the “Loan Agreement”);

WHEREAS, the Borrower has requested that the Lender make certain amendments to the Loan Agreement; and

WHEREAS, upon the terms and conditions set forth herein, Lender is willing to accommodate the Borrower’s requests.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement, as amended hereby.

2. Amendments to Loan Agreement.

(a) Section 1.1 to the Loan Agreement is hereby amended by amending and restating the definition of “Maximum Revolver Amount” as follows:

“Maximum Revolver Amount” means $15,000,000.

(b) Section 3.4 to the Loan Agreement is hereby amended by deleting the “December 31, 2012” appearing therein and replacing it with “December 31, 2013”.

3. Conditions Precedent to Amendment. The satisfaction of each of the following shall constitute conditions precedent to the effectiveness of the Amendment (such date being the “Amendment Effective Date”):

(a) Lender shall have received this Amendment, duly executed by the parties hereto, and the same shall be in full force and effect.

(b) Lender shall have received evidence reasonably satisfactory to Lender that Borrower has received net cash proceeds of a cash equity investment in immediately available funds of at least $5,000,000.

(c) The representations and warranties herein and in the Loan Agreement and the other Loan Documents shall be true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date).

(d) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein shall have been issued and remain in force by any Governmental Authority against the Borrower or Lender.

(e) No Default or Event of Default shall have occurred and be continuing or shall result from the consummation of the transactions contemplated herein.

(f) All other documents and legal matters in connection with the transactions contemplated by this Amendment shall have been delivered, executed, or recorded and shall be in form and substance reasonably satisfactory to Lender.

4. Representations and Warranties. Borrower hereby represents and warrants to Lender as follows:

(a) It (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified reasonably could be expected to result in a Material Adverse Change, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby.

(b) The execution, delivery, and performance by it of this Amendment and the performance by it of each Loan Document to which it is or will be a party (i) have been duly authorized by all necessary action, and (ii) do not and will not (A) violate any material provision of federal, state or local law, rule or regulation, or any order, judgment, decree, writ, injunction or award of any arbitrator, court or governmental authority finding on it or its Subsidiaries, the Governing Documents of it or its Subsidiaries, or any order, judgment or decree of any court or other Governmental Authority binding on it or its Subsidiaries, (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of it or its Subsidiaries, except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Change, (C) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of Borrower, other than Permitted Liens, or (D) require any approval of Borrower’s interestholders or any approval or consent of any Person under any material contractual obligation of Borrower, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of a material contractual obligation, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Change.

(c) The execution, delivery and performance by Borrower of the Loan Documents and the consummation of the transactions contemplated by the Loan Documents do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority other than consents or approvals that have been obtained and that are still in force and effect.

(d) This Amendment is, and each other Loan Document to which it is or will be a party, when executed and delivered by each Person that is a party thereto, will be the legally valid and binding obligation of such Person, enforceable against such Person in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally.

(e) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein has been issued and remains in force by any Governmental Authority against the Borrower or Lender.

(f) No Default or Event of Default has occurred and is continuing as of the date of the effectiveness of this Amendment, and no condition exists which constitutes a Default or an Event of Default.

(g) The representations and warranties set forth in this Amendment, the Loan Agreement, as amended by this Amendment, and the other Loan Documents to which it is a party are true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date.)

(h) This Amendment has been entered into without force or duress, of the free will of Borrower, and the decision of Borrower to enter into this Amendment is a fully informed decision and Borrower is aware of all legal and other ramifications of each decision.

(i) It has read and understands this Amendment, has consulted with and been represented by independent legal counsel of its own choosing in negotiations for and the preparation of this Amendment, has read this Amendment in full and final form, and has been advised by its counsel of its rights and obligations hereunder and thereunder.

5. Payment of Costs and Fees. Borrower shall pay to Lender all costs, all out-of-pocket expenses, and all fees and charges of every kind in connection with the preparation, negotiation, execution and delivery of this Amendment and any documents and instruments relating hereto. In addition thereto, the Borrower agrees to reimburse Lender on demand for its costs arising out of this Amendment and all documents or instruments relating hereto (which costs may include the reasonable fees and expenses of any attorneys retained by Lender).

6. Choice of Law. This Amendment and the rights of the parties hereunder, shall be governed by, and construed in accordance with, the laws of the State of California applicable to contracts made and to be performed in the State of California.

7. Amendments. This Amendment cannot be altered, amended, changed or modified in any respect or particular unless each such alteration, amendment, change or modification shall have been agreed to by each of the parties and reduced to writing in its entirety and signed and delivered by each party.

8. Counterpart Execution. This Amendment may be executed in any number of counterparts, all of which when taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Amendment by signing any such counterpart. Delivery of an executed counterpart of this Amendment by telefacsimile or electronic mail shall be equally as effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by telefacsimile or electronic mail also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

9. Effect on Loan Documents.

(a) The Loan Agreement, as amended hereby, and each of the other Loan Documents shall be and remain in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. The execution, delivery, and performance of this Amendment shall not operate, except as expressly set forth herein, as a modification or waiver of any right, power, or remedy of Lender under the Loan Agreement or any other Loan Document. The waivers, consents and modifications herein are limited to the specifics hereof (including facts or occurrences on which the same are based), shall not apply with respect to any facts or occurrences other than those on which the same are based, shall not excuse any non-compliance with the Loan Documents, and shall not operate as a consent to any matter under the Loan Documents. Except for the amendments to the Loan Agreement expressly set forth herein, the Loan Agreement and other Loan Documents shall remain unchanged and in full force and effect. The execution,

delivery and performance of this Amendment shall not operate as a waiver of or, except as expressly set forth herein, as an amendment of, any right, power or remedy of the Lender in effect prior to the date hereof. The amendments and waivers set forth herein are limited to the specifics hereof, shall not apply with respect to any facts or occurrences other than those on which the same are based, and except as expressly set forth herein, shall neither excuse any future non-compliance with the Loan Agreement, nor operate as a waiver of any Default or Event of Default (other than the Designated Events of Default). To the extent any terms or provisions of this Amendment conflict with those of the Loan Agreement or other Loan Documents, the terms and provisions of this Amendment shall control.

(b) Upon and after the effectiveness of this Amendment, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “herein”, “hereof” or words of like import referring to the Loan Agreement, and each reference in the other Loan Documents to “the Loan Agreement”, “thereunder”, “therein”, “thereof” or words of like import referring to the Loan Agreement, shall mean and be a reference to the Loan Agreement as modified and amended hereby.

(c) To the extent that any terms and conditions in any of the Loan Documents shall contradict or be in conflict with any terms or conditions of the Loan Agreement, such terms and conditions are hereby deemed modified or amended accordingly to reflect the terms and conditions of the Loan Agreement as modified or amended hereby.

(d) This Amendment is a Loan Document.

(e) Unless the context of this Amendment clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or”.

10. Entire Agreement. This Amendment, and terms and provisions hereof, the Loan Agreement and the other Loan Documents constitute the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes any and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied, oral or written.

11. Integration. This Amendment, together with the other Loan Documents, incorporates all negotiations of the parties hereto with respect to the subject matter hereof and is the final expression and agreement of the parties hereto with respect to the subject matter hereof.

12. Release.

(a) Effective on the date hereof, each of Borrower and, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through such Person, hereby waives, releases, remises and forever discharges Lender, each of its Affiliates, and each of their respective successors in title, past, present and future officers, directors, employees, limited partners, general partners, investors, attorneys, assigns, subsidiaries, shareholders, trustees, agents and other professionals and all other persons and entities to whom the Lender would be liable if such persons or entities were found to be liable to Borrower (each a “Releasee” and collectively, the “Releasees”), from any and all past, present and future claims, suits, liens, lawsuits, adverse consequences, amounts paid in settlement, debts, deficiencies, diminution in value, disbursements, demands, obligations, liabilities, causes of action, damages, losses, costs and expenses of any kind or character, whether based in equity, law, contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law (each a “Claim” and collectively, the “Claims”), whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, matured or unmatured, foreseen or unforseen, past or present, liquidated or unliquidated, suspected or unsuspected, which Borrower ever had from the beginning of the world, now has, or might hereafter have against any such Releasee which relates, directly or indirectly to the Loan Agreement,

any other Loan Document, or to any acts or omissions of any such Releasee with respect to the Loan Agreement or any other Loan Document, or to the lender-borrower relationship evidenced by the Loan Documents, except for the duties and obligations set forth in this Amendment. As to each and every claim released hereunder, Borrower hereby represents that it has received the advice of legal counsel with regard to the releases contained herein, and having been so advised, specifically waives the benefit of the provisions of Section 1542 of the Civil Code of California which provides as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

(b) Borrower acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agrees that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.

(c) Borrower, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee above that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any claim released, remised and discharged by such Person pursuant to the above release. Borrower further agrees that it shall not dispute the validity or enforceability of the Loan Agreement or any of the other Loan Documents or any of its obligations thereunder, or the validity, priority, enforceability or the extent of Lender’s Lien on any item of Collateral under the Loan Agreement or the other Loan Documents. If Borrower or any of its successors, assigns, or officers, directors, employees, agents or attorneys, or any Person acting for or on behalf of, or claiming through it violate the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys’ fees and costs incurred by such Releasee as a result of such violation.

13. Acknowledgments.

(a) Acknowledgment of Obligations. Each of Borrower and Lender hereby acknowledges, confirms and agrees that as of the close of business on February 9, 2012, Borrower was indebted to Lender for loans and other financial accommodations under the Loan Documents in the aggregate outstanding amount of principal and interest of in respect of the Advances, $8,073,131.94, (which amount is comprised of $8,000,000.00 of principal outstanding, and $73,131.94 of accrued and unpaid interest) plus out-of-pocket expenses incurred by Lender due and owing under the Loan Documents. All such Obligations owing by Borrower, in each case together with interest accrued and accruing thereon as provided in the Loan Documents, and all fees, costs, expenses and other charges now or hereafter payable by Borrower to Lender (with respect to any fees charged by Lender which are not in respect of out-of-pocket fees and expenses and which have accrued on or before the date hereof, to the extent that Lender has given notice to the Borrower of the amount thereof), are unconditionally owing by Borrower to Lender, without offset, defense, withholding, counterclaim or deduction of any kind, nature or description whatsoever and shall be payable in accordance with the terms of the Loan Agreement and the other Loan Documents as amended hereby.

(b) Acknowledgement of Security Interests. Borrower hereby acknowledges, confirms and agrees that Lender has and shall continue to have valid, enforceable and perfected first-priority liens upon and security interests in the Collateral granted to Lender pursuant to the Loan Documents or otherwise granted to or held by Lender.

(c) No Disregard of Loan Documents. Borrower hereby acknowledges that the parties hereto have not entered into a mutual disregard of the terms and provisions of the Loan Agreement or the other Loan Documents, or engaged in any course of dealing in variance with the terms and provisions of the Loan Agreement or the Loan Documents, within the meaning of any applicable law of the State of California, or otherwise.

14. Reaffirmation of Obligations. The Borrower hereby reaffirms its obligations under each Loan Document to which it is a party. The Borrower hereby further ratifies and reaffirms the validity and enforceability of all of the liens and security interests heretofore granted, pursuant to and in connection with any Loan Document to Lender as collateral security for the obligations under the Loan Documents in accordance with their respective terms, and acknowledges that all of such liens and security interests, and all collateral heretofore pledged as security for such obligations, continues to be and remain collateral for such obligations from and after the date hereof.

15. Ratification. The Borrower hereby restates, ratifies and reaffirms each and every term and condition set forth in the Loan Agreement and the Loan Documents effective as of the date hereof and as amended hereby.

16. Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

[signature pages follow]

IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first above written.

PROFESSOR CONNOR’S, INC., a Delaware corporation, as Borrower
By:
Name:	Richard A Kassar
Title:	CFO

[SIGNATURE PAGE TO AMENDMENT NUMBER ONE TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

CITY NATIONAL BANK, a national banking association, as Lender
By:
Name:	Garen Papazyan
Title:	Vice President

[SIGNATURE PAGE TO AMENDMENT NUMBER ONE TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

EX-10.7

Exhibit 10.7

[Execution Copy]

AMENDMENT NUMBER TWO TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

THIS AMENDMENT NUMBER TWO TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”), dated as of May 2, 2012 is entered into by and between PROFESSOR CONNOR’S, INC., a Delaware corporation (“Borrower”), and CITY NATIONAL BANK, a national banking association (“Lender”), and in light of the following:

W I T N E S S E T H

WHEREAS, Borrower and Lender are parties to that certain Amended and Restated Loan and Security Agreement, dated as of December 23, 2010 (as amended, restated, supplemented, or otherwise modified prior to the date hereof and as further amended, restated, supplemented, or otherwise modified from time to time, the “Loan Agreement”);

WHEREAS, the Borrower has requested that the Lender make certain amendments to the Loan Agreement; and

WHEREAS, upon the terms and conditions set forth herein, Lender is willing to accommodate the Borrower’s requests.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement, as amended hereby.

2. Amendments to Loan Agreement. Section 7.13 to the Loan Agreement is hereby amended and restated as follows:

“Transactions with Affiliates. Directly or indirectly enter into or permit to exist any transaction with any Affiliate of Borrower except for (a) transactions that (i) are in the ordinary course of Borrower’s business, (ii) are upon fair and reasonable terms, and (iii) are no less favorable to Borrower or its Subsidiaries, as applicable, than would be obtained in an arm’s length transaction with a non-Affiliate or (b) transactions involving the payment of fees (and entering into related agreements with respect thereto) to shareholders of the Borrower in connection with the guarantee of any Indebtedness of the Borrower by such shareholder so long as such fees have been approved by the board of directors of the Borrower.

3. Conditions Precedent to Amendment. The satisfaction of each of the following shall constitute conditions precedent to the effectiveness of the Amendment (such date being the “Amendment Effective Date”):

(a) Lender shall have received this Amendment, duly executed by the parties hereto, and the same shall be in full force and effect.

(b) The representations and warranties herein and in the Loan Agreement and the other Loan Documents shall be true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date).

[Execution Copy]

(c) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein shall have been issued and remain in force by any Governmental Authority against the Borrower or Lender.

(d) No Default or Event of Default shall have occurred and be continuing or shall result from the consummation of the transactions contemplated herein.

(e) All other documents and legal matters in connection with the transactions contemplated by this Amendment shall have been delivered, executed, or recorded and shall be in form and substance reasonably satisfactory to Lender.

4. Representations and Warranties. Borrower hereby represents and warrants to Lender as follow’s:

(a) It (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified reasonably could be expected to result in a Material Adverse Change, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby.

(b) The execution, delivery, and performance by it of this Amendment and the performance by it of each Loan Document to which it is or will be a party (i) have been duly authorized by all necessary action, and (ii) do not and will not (A) violate any material provision of federal, state or local law. rule or regulation, or any order, judgment, decree, writ, injunction or award of any arbitrator, court or governmental authority finding on it or its Subsidiaries, the Governing Documents of it or its Subsidiaries, or any order, judgment or decree of any court or other Governmental Authority binding on it or its Subsidiaries, (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of it or its Subsidiaries, except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Change, (C) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of Borrower, other than Permitted Liens, or (D) require any approval of Borrower’s interestholders or any approval or consent of any Person under any material contractual obligation of Borrower, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of a material contractual obligation, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Change.

(c) The execution, delivery and performance by Borrower of the Loan Documents and the consummation of the transactions contemplated by the Loan Documents do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority other than consents or approvals that have been obtained and that are still in force and effect.

(d) This Amendment is, and each other Loan Document to which it is or will be a party, when executed and delivered by each Person that is a party thereto, will be the legally valid and binding obligation of such Person, enforceable against such Person in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar law’s relating to or limiting creditors’ rights generally.

(e) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein has been issued and remains in force by any Governmental Authority against the Borrower or Lender.

[Execution Copy]

(f) No Default or Event of Default has occurred and is continuing as of the date of the effectiveness of this Amendment, and no condition exists which constitutes a Default or an Event of Default.

(g) The representations and warranties set forth in this Amendment, the Loan Agreement, as amended by this Amendment, and the other Loan Documents to which it is a party are true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date.)

(h) This Amendment has been entered into without force or duress, of the free will of Borrower, and the decision of Borrower to enter into this Amendment is a fully informed decision and Borrower is aware of all legal and other ramifications of each decision.

(i) It has read and understands this Amendment, has consulted with and been represented by independent legal counsel of its own choosing in negotiations for and the preparation of this Amendment, has read this Amendment in full and final form, and has been advised by its counsel of its rights and obligations hereunder and thereunder.

5. Payment of Costs and Fees. Borrower shall pay to Lender all costs, all out-of-pocket expenses, and all fees and charges of every kind in connection with the preparation, negotiation, execution and delivery of this Amendment and any documents and instruments relating hereto. In addition thereto, the Borrower agrees to reimburse Lender on demand for its costs arising out of this Amendment and all documents or instruments relating hereto (which costs may include the reasonable fees and expenses of any attorneys retained by Lender).

6. Choice of Law. This Amendment and the rights of the parties hereunder, shall be governed by, and construed in accordance with, the laws of the State of California applicable to contracts made and to be performed in the State of California.

7. Amendments. This Amendment cannot be altered, amended, changed or modified in any respect or particular unless each such alteration, amendment, change or modification shall have been agreed to by each of the parties and reduced to writing in its entirety and signed and delivered by each party.

8. Counterpart Execution. This Amendment may be executed in any number of counterparts, all of which when taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Amendment by signing any such counterpart. Delivery of an executed counterpart of this Amendment by telefacsimile or electronic mail shall be equally as effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by telefacsimile or electronic mail also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

9. Effect on Loan Documents.

(a) The Loan Agreement, as amended hereby, and each of the other Loan Documents shall be and remain in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. The execution, delivery, and performance of this Amendment shall not operate, except as expressly set forth herein, as a modification or waiver of any right, power, or remedy of Lender under the Loan Agreement or any other Loan Document. The waivers, consents and modifications herein are limited to the specifics hereof (including facts or occurrences on which the same are based), shall not apply with respect to any facts or occurrences other than those on which the same are based, shall not excuse any non-compliance with the Loan Documents, and shall not operate as a consent to any matter under the Loan Documents. Except for the amendments to the Loan Agreement expressly set forth herein, the Loan Agreement and other Loan Documents shall remain unchanged and in full force and effect. The execution,

[Execution Copy]

delivery and performance of this Amendment shall not operate as a waiver of or, except as expressly set forth herein, as an amendment of, any right, power or remedy of the Lender in effect prior to the date hereof. The amendments and waivers set forth herein are limited to the specifics hereof, shall not apply with respect to any facts or occurrences other than those on which the same are based, and except as expressly set forth herein, shall neither excuse any future non-compliance with the Loan Agreement, nor operate as a waiver of any Default or Event of Default (other than the Designated Events of Default). To the extent any terms or provisions of this Amendment conflict with those of the Loan Agreement or other Loan Documents, the terms and provisions of this Amendment shall control.

(b) Upon and after the effectiveness of this Amendment, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “herein”, “hereof” or words of like import referring to the Loan Agreement, and each reference in the other Loan Documents to “the Loan Agreement”, “thereunder”, “therein”, “thereof” or words of like import referring to the Loan Agreement, shall mean and be a reference to the Loan Agreement as modified and amended hereby.

(c) To the extent that any terms and conditions in any of the Loan Documents shall contradict or be in conflict with any terms or conditions of the Loan Agreement, such terms and conditions are hereby deemed modified or amended accordingly to reflect the terms and conditions of the Loan Agreement as modified or amended hereby.

(d) This Amendment is a Loan Document.

(e) Unless the context of this Amendment clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or”.

10. Entire Agreement. This Amendment, and terms and provisions hereof, the Loan Agreement and the other Loan Documents constitute the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes any and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied, oral or written.

11. Integration. This Amendment, together with the other Loan Documents, incorporates all negotiations of the parties hereto with respect to the subject matter hereof and is the final expression and agreement of the parties hereto with respect to the subject matter hereof

12. Release.

(a) Effective on the date hereof, each of Borrower and, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through such Person, hereby waives, releases, remises and forever discharges Lender, each of its Affiliates, and each of their respective successors in title, past, present and future officers, directors, employees, limited partners, general partners, investors, attorneys, assigns, subsidiaries, shareholders, trustees, agents and other professionals and all other persons and entities to whom the Lender would be liable if such persons or entities were found to be liable to Borrower (each a “Releasee” and collectively, the “Releasees”), from any and all past, present and future claims, suits, liens, lawsuits, adverse consequences, amounts paid in settlement, debts, deficiencies, diminution in value, disbursements, demands, obligations, liabilities, causes of action, damages, losses, costs and expenses of any kind or character, whether based in equity, law, contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law (each a “Claim” and collectively, the “Claims”), whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, matured or unmatured, foreseen or unforseen, past or present, liquidated or unliquidated, suspected or unsuspected, which Borrower ever had from the beginning of the world, now has, or

[Execution Copy]

might hereafter have against any such Releasee which relates, directly or indirectly to the Loan Agreement, any other Loan Document, or to any acts or omissions of any such Releasee with respect to the Loan Agreement or any other Loan Document, or to the lender-borrower relationship evidenced by the Loan Documents, except for the duties and obligations set forth in this Amendment. As to each and every claim released hereunder, Borrower hereby represents that it has received the advice of legal counsel with regard to the releases contained herein, and having been so advised, specifically waives the benefit of the provisions of Section 1542 of the Civil Code of California which provides as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

(b) Borrower acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agrees that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.

(c) Borrower, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee above that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any claim released, remised and discharged by such Person pursuant to the above release. Borrower further agrees that it shall not dispute the validity or enforceability of the Loan Agreement or any of the other Loan Documents or any of its obligations thereunder, or the validity, priority, enforceability or the extent of Lender’s Lien on any item of Collateral under the Loan Agreement or the other Loan Documents. If Borrower or any of its successors, assigns, or officers, directors, employees, agents or attorneys, or any Person acting for or on behalf of, or claiming through it violate the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys’ fees and costs incurred by such Releasee as a result of such violation.

13. Acknowledgments.

(a) Acknowledgement of Security Interests. Borrower hereby acknowledges, confirms and agrees that Lender has and shall continue to have valid, enforceable and perfected first-priority liens upon and security interests in the Collateral granted to Lender pursuant to the Loan Documents or otherwise granted to or held by Lender.

(b) No Disregard of Loan Documents. Borrower hereby acknowledges that the parties hereto have not entered into a mutual disregard of the terms and provisions of the Loan Agreement or the other Loan Documents, or engaged in any course of dealing in variance with the terms and provisions of the Loan Agreement or the Loan Documents, within the meaning of any applicable law of the State of California, or otherwise.

14. Reaffirmation of Obligations. The Borrower hereby reaffirms its obligations under each Loan Document to which it is a party. The Borrower hereby further ratifies and reaffirms the validity and enforceability of all of the liens and security interests heretofore granted, pursuant to and in connection with any Loan Document to Lender as collateral security for the obligations under the Loan Documents in accordance with their respective terms, and acknowledges that all of such liens and security interests, and all collateral heretofore pledged as security for such obligations, continues to be and remain collateral for such obligations from and after the date hereof.

[Execution Copy]

15. Ratification. The Borrower hereby restates, ratifies and reaffirms each and every term and condition set forth in the Loan Agreement and the Loan Documents effective as of the date hereof and as amended hereby.

16. Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

[signature pages follow]

IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first above written.

PROFESSOR CONNOR’S, INC.,
a Delaware corporation, as Borrower
By:
Name:	Richard Kassar
Title:	President

[SIGNATURE PAGE TO AMENDMENT NUMBER TWO TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

CITY NATIONAL BANK,
a national banking association, as Lender
By:
Name:	Aaron Cohen
Title:	Senior Vice President

[SIGNATURE PAGE TO AMENDMENT NUMBER TWO TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

EX-10.8

Exhibit 10.8

AMENDMENT NUMBER THREE TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

THIS AMENDMENT NUMBER THREE TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”), dated as of June 8, 2012 is entered into by and between PROFESSOR CONNOR’S, INC., a Delaware corporation (“Borrower”), and CITY NATIONAL BANK, a national banking association (“Lender”), and in light of the following:

W I T N E S S E T H

WHEREAS, Borrower and Lender are parties to that certain Amended and Restated Loan and Security Agreement, dated as of December 23, 2010 (as amended, restated, supplemented, or otherwise modified from time to time, the “Loan Agreement”);

WHEREAS, Borrower has requested that Lender make certain amendments to the Loan Agreement; and

WHEREAS, upon the terms and conditions set forth herein, Lender is willing to accommodate Borrower’s requests.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement, as amended hereby.

2. Amendments to Loan Agreement.

(a) Section 1.1 to the Loan Agreement is hereby amended by amending and restating the following definitions as follows:

““Adjusted EBITDA” means, with respect to any fiscal quarter, Borrower’s and its Subsidiaries’ consolidated gross revenue, minus the cost of goods sold, minus selling, general, and administrative expenses (but excluding: (a) any costs associated with the installation of refrigerators in new locations and marketing expenses incurred in connection with the introduction of new locations; (b) all non-cash expenses or losses, including any depreciation and amortization expense; (c) any marketing expenses incurred in connection with television marketing; (d) non-recurring fees, charges and other one time start-up costs in connection with any real property (including all buildings, fixtures, integrated equipment or other improvements located thereon) now, hereafter or heretofore owned, leased, operated or used by Borrower or any of its Subsidiaries for the purpose of developing, manufacturing and marketing pet food; and (e) other non-recurring fees, charges and other expenses that have been approved by Lender, such approval not to be unreasonably withheld).”

““TTM EBITDA” means, as of any date of determination, (a) the product of (i) Adjusted EBITDA of Borrower determined on a consolidated basis in accordance with GAAP, for the most recently ended fiscal quarter of Borrower as to which financial statements have been delivered to Lender pursuant hereto times (ii) four (4), minus (b) the aggregate amount of marketing expenses incurred in connection with television marketing for the four fiscal quarters immediately preceding such fiscal quarter, to the extent that such amount described in this clause (b) exceeds $6,000,000.”

(b) Section 3.4(a) to the Loan Agreement is hereby amended by deleting “December 31, 2013” appearing therein and replacing it with “December 31, 2014”.

(c) Section 7.18(a)(i) to the Loan Agreement is hereby amended and restated in its entirety as follows:

“(i) Leverage Ratio. A Leverage Ratio, measured on a quarter-end basis, of not greater than the applicable ratio set forth in the following table for the applicable date set forth opposite thereto:

Applicable Ratio	Period
3:00:1.00	For the 3 month period ending June 30, 2013
3:00:1.00	For the 3 month period ending September 30, 2013
3:00:1.00	For the 3 month period ending December 31, 2013
2:50:1.00	For the 3 month period ending March 31, 2014
2:50:1.00	For the 3 month period ending June 30, 2014
2:00:1.00	For the 3 month period ending September 30, 2014
2:00:1.00	For the 3 month period ending December 31, 2014
		”

(d) Section 7.18(a)(ii) to the Loan Agreement is hereby amended by amending and restating the table appearing therein as follows:

Applicable Amount		Period
$	4,687,000	For the 3 month period ending June 30, 2011
$	5,426,000	For the 3 month period ending September 30, 2011
$	6,783,000	For the 3 month period Ending December 31, 2011
$	7,732,000	For the 3 month period ending March 31, 2012
$	8,601,000	For the 3 month period ending June 30, 2012
$	9,362,000	For the 3 month period ending September 30, 2012
$	10,567,000	For the 3 month period Ending December 31, 2012
$	10,708,000	For the 3 month period Ending March 31, 2013
$	12,313,000	For the 3 month period Ending June 30, 2013

3. Conditions Precedent to Amendment. The satisfaction of each of the following shall constitute conditions precedent to the effectiveness of the Amendment (such date being the “Amendment Effective Date”):

(a) Lender shall have received this Amendment, duly executed by the parties hereto, and the same shall be in full force and effect.

(b) Lender shall have received (i) that certain Credit Agreement dated as of June 8, 2012 by and among Borrower, ONEWEST BANK, FSB, as Administrative Agent (in such capacity, the “Junior Agent”), and the Junior Lenders party thereto (the “Junior Credit Agreement”), duly executed by the parties thereto, in form and substance satisfactory to Lender and (ii) any and all security agreements, including any deed of trust, mortgage or similar security document, executed in favor of the Junior Agent in connection with the Junior Credit Agreement, each of which shall be in form and substance satisfactory to Lender.

(c) Lender shall have received a subordination agreement by and among Lender, Borrower and Junior Agent, duly executed and delivered by the parties thereto, which shall be in form and substance satisfactory to Lender.

(d) Lender shall have received amendments to Borrower’s Governing Documents or any other agreements evidencing Borrower’s Preferred Stock, which amendments shall extend the mandatory redemption date with respect to such Preferred Stock to a date that is after December 31, 2014, and which amendments shall be otherwise in form and substance satisfactory to Lender.

(e) The representations and warranties herein and in the Loan Agreement and the other Loan Documents shall be true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date).

(f) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein shall have been issued and remain in force by any Governmental Authority against Borrower or Lender.

(g) No Default or Event of Default shall have occurred and be continuing or shall result from the consummation of the transactions contemplated herein.

(h) All other documents and legal matters in connection with the transactions contemplated by this Amendment shall have been delivered, executed, or recorded and shall be in form and substance reasonably satisfactory to Lender.

4. Representations and Warranties. Borrower hereby represents and warrants to Lender as follows:

(a) It (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified reasonably could be expected to result in a Material Adverse Change, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby.

(b) The execution, delivery, and performance by it of this Amendment and the performance by it of each Loan Document to which it is or will be a party (i) have been duly authorized by all necessary action, and (ii) do not and will not (A) violate any material provision of federal, state or local law, rule or regulation, or any order, judgment, decree, writ, injunction or award of any arbitrator, court or governmental authority finding on it or its Subsidiaries, the Governing Documents of it or its Subsidiaries, or

any order, judgment or decree of any court or other Governmental Authority binding on it or its Subsidiaries, (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of it or its Subsidiaries, except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Change, (C) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of Borrower, other than Permitted Liens, or (D) require any approval of Borrower’s interestholders or any approval or consent of any Person under any material contractual obligation of Borrower, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of a material contractual obligation, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Change.

(c) The execution, delivery and performance by Borrower of the Loan Documents and the consummation of the transactions contemplated by the Loan Documents do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority other than consents or approvals that have been obtained and that are still in force and effect.

(d) This Amendment is, and each other Loan Document to which it is or will be a party, when executed and delivered by each Person that is a party thereto, will be the legally valid and binding obligation of such Person, enforceable against such Person in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally.

(e) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein has been issued and remains in force by any Governmental Authority against Borrower or Lender.

(f) No Default or Event of Default has occurred and is continuing as of the date of the effectiveness of this Amendment, and no condition exists which constitutes a Default or an Event of Default.

(g) The representations and warranties set forth in this Amendment, the Loan Agreement, as amended by this Amendment, and the other Loan Documents to which it is a party are true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date.)

(h) This Amendment has been entered into without force or duress, of the free will of Borrower, and the decision of Borrower to enter into this Amendment is a fully informed decision and Borrower is aware of all legal and other ramifications of each decision.

(i) It has read and understands this Amendment, has consulted with and been represented by independent legal counsel of its own choosing in negotiations for and the preparation of this Amendment, has read this Amendment in full and final form, and has been advised by its counsel of its rights and obligations hereunder and thereunder.

5. Payment of Costs and Fees. Borrower shall pay to Lender all costs, all out-of-pocket expenses, and all fees and charges of every kind in connection with the preparation, negotiation, execution and delivery of this Amendment and any documents and instruments relating hereto. In addition thereto, Borrower agrees to reimburse Lender on demand for its costs arising out of this Amendment and all documents or instruments relating hereto (which costs may include the reasonable fees and expenses of any attorneys retained by Lender).

6. Choice of Law. This Amendment and the rights of the parties hereunder, shall be governed by, and construed in accordance with, the laws of the State of California applicable to contracts made and to be performed in the State of California.

7. Amendments. This Amendment cannot be altered, amended, changed or modified in any respect or particular unless each such alteration, amendment, change or modification shall have been agreed to by each of the parties and reduced to writing in its entirety and signed and delivered by each party.

8. Counterpart Execution. This Amendment may be executed in any number of counterparts, all of which when taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Amendment by signing any such counterpart. Delivery of an executed counterpart of this Amendment by telefacsimile or electronic mail shall be equally as effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by telefacsimile or electronic mail also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

9. Effect on Loan Documents.

(a) The Loan Agreement, as amended hereby, and each of the other Loan Documents shall be and remain in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. The execution, delivery, and performance of this Amendment shall not operate, except as expressly set forth herein, as a modification or waiver of any right, power, or remedy of Lender under the Loan Agreement or any other Loan Document. The waivers, consents and modifications herein are limited to the specifics hereof (including facts or occurrences on which the same are based), shall not apply with respect to any facts or occurrences other than those on which the same are based, shall not excuse any non-compliance with the Loan Documents, and shall not operate as a consent to any matter under the Loan Documents. Except for the amendments to the Loan Agreement expressly set forth herein, the Loan Agreement and other Loan Documents shall remain unchanged and in full force and effect. The execution, delivery and performance of this Amendment shall not operate as a waiver of or, except as expressly set forth herein, as an amendment of, any right, power or remedy of Lender in effect prior to the date hereof. The amendments and waivers set forth herein are limited to the specifics hereof, shall not apply with respect to any facts or occurrences other than those on which the same are based, and except as expressly set forth herein, shall neither excuse any future non-compliance with the Loan Agreement, nor operate as a waiver of any Default or Event of Default (other than the Designated Events of Default). To the extent any terms or provisions of this Amendment conflict with those of the Loan Agreement or other Loan Documents, the terms and provisions of this Amendment shall control.

(b) Upon and after the effectiveness of this Amendment, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “herein”, “hereof” or words of like import referring to the Loan Agreement, and each reference in the other Loan Documents to “the Loan Agreement”, “thereunder”, “therein”, “thereof” or words of like import referring to the Loan Agreement, shall mean and be a reference to the Loan Agreement as modified and amended hereby.

(c) To the extent that any terms and conditions in any of the Loan Documents shall contradict or be in conflict with any terms or conditions of the Loan Agreement, such terms and conditions are hereby deemed modified or amended accordingly to reflect the terms and conditions of the Loan Agreement as modified or amended hereby.

(d) This Amendment is a Loan Document.

(e) Unless the context of this Amendment clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or”.

10. Entire Agreement. This Amendment, and terms and provisions hereof, the Loan Agreement and the other Loan Documents constitute the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes any and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied, oral or written.

11. Integration. This Amendment, together with the other Loan Documents, incorporates all negotiations of the parties hereto with respect to the subject matter hereof and is the final expression and agreement of the parties hereto with respect to the subject matter hereof.

12. Release.

(a) Effective on the date hereof, each of Borrower and, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through such Person, hereby waives, releases, remises and forever discharges Lender, each of its Affiliates, and each of their respective successors in title, past, present and future officers, directors, employees, limited partners, general partners, investors, attorneys, assigns, subsidiaries, shareholders, trustees, agents and other professionals and all other persons and entities to whom Lender would be liable if such persons or entities were found to be liable to Borrower (each a “Releasee” and collectively, the “Releasees”), from any and all past, present and future claims, suits, liens, lawsuits, adverse consequences, amounts paid in settlement, debts, deficiencies, diminution in value, disbursements, demands, obligations, liabilities, causes of action, damages, losses, costs and expenses of any kind or character, whether based in equity, law, contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law (each a “Claim” and collectively, the “Claims”), whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, matured or unmatured, foreseen or unforseen, past or present, liquidated or unliquidated, suspected or unsuspected, which Borrower ever had from the beginning of the world, now has, or might hereafter have against any such Releasee which relates, directly or indirectly to the Loan Agreement, any other Loan Document, or to any acts or omissions of any such Releasee with respect to the Loan Agreement or any other Loan Document, or to the lender-borrower relationship evidenced by the Loan Documents, except for the duties and obligations set forth in this Amendment. As to each and every claim released hereunder, Borrower hereby represents that it has received the advice of legal counsel with regard to the releases contained herein, and having been so advised, specifically waives the benefit of the provisions of Section 1542 of the Civil Code of California which provides as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

(b) Borrower acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agrees that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.

(c) Borrower, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee above that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any claim released, remised and discharged by such Person pursuant to the above release. Borrower further agrees that it shall not dispute the validity or enforceability of the Loan Agreement or any of the other Loan Documents or any of its obligations thereunder, or the validity, priority, enforceability or the extent of

Lender’s Lien on any item of Collateral under the Loan Agreement or the other Loan Documents. If Borrower or any of its successors, assigns, or officers, directors, employees, agents or attorneys, or any Person acting for or on behalf of, or claiming through it violate the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys’ fees and costs incurred by such Releasee as a result of such violation.

13. Acknowledgments.

(a) Acknowledgment of Obligations. Each of Borrower and Lender hereby acknowledges, confirms and agrees that as of the close of business on June 8, 2012, Borrower was indebted to Lender for loans and other financial accommodations under the Loan Documents in the aggregate outstanding amount of principal and interest of in respect of the Advances, $15,149,111.11, (which amount is comprised of $15,000,000.00 of principal outstanding, and $149,111.11 of accrued and unpaid interest) plus out-of-pocket expenses incurred by Lender due and owing under the Loan Documents. All such Obligations owing by Borrower, in each case together with interest accrued and accruing thereon as provided in the Loan Documents, and all fees, costs, expenses and other charges now or hereafter payable by Borrower to Lender (with respect to any fees charged by Lender which are not in respect of out-of-pocket fees and expenses and which have accrued on or before the date hereof, to the extent that Lender has given notice to Borrower of the amount thereof), are unconditionally owing by Borrower to Lender, without offset, defense, withholding, counterclaim or deduction of any kind, nature or description whatsoever and shall be payable in accordance with the terms of the Loan Agreement and the other Loan Documents as amended hereby.

(b) Acknowledgement of Security Interests. Borrower hereby acknowledges, confirms and agrees that Lender has and shall continue to have valid, enforceable and perfected first-priority liens upon and security interests in the Collateral granted to Lender pursuant to the Loan Documents or otherwise granted to or held by Lender.

(c) No Disregard of Loan Documents. Borrower hereby acknowledges that the parties hereto have not entered into a mutual disregard of the terms and provisions of the Loan Agreement or the other Loan Documents, or engaged in any course of dealing in variance with the terms and provisions of the Loan Agreement or the Loan Documents, within the meaning of any applicable law of the State of California, or otherwise.

14. Reaffirmation of Obligations. Borrower hereby reaffirms its obligations under each Loan Document to which it is a party. Borrower hereby further ratifies and reaffirms the validity and enforceability of all of the liens and security interests heretofore granted, pursuant to and in connection with any Loan Document to Lender as collateral security for the obligations under the Loan Documents in accordance with their respective terms, and acknowledges that all of such liens and security interests, and all collateral heretofore pledged as security for such obligations, continues to be and remain collateral for such obligations from and after the date hereof.

15. Ratification. Borrower hereby restates, ratifies and reaffirms each and every term and condition set forth in the Loan Agreement and the Loan Documents effective as of the date hereof and as amended hereby.

16. Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

[signature pages follow]

IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first above written.

PROFESSOR CONNOR’S, INC.,
A Delaware corporation, as Borrower
By:
Name:	S MACCHIAVERNA
Title:	SECRETARY

[SIGNATURE PAGE TO AMENDMENT NUMBER THREE TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

CITY NATIONAL BANK,
a national banking association, as Lender
By:
Name:	Garen Papazyan
Title:	Senior Vice President

[SIGNATURE PAGE TO AMENDMENT NUMBER THREE TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

EX-10.9

Exhibit 10.9

AMENDMENT NUMBER FOUR TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

THIS AMENDMENT NUMBER FOUR TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”), dated as of May 3, 2013 is entered into by and between PROFESSOR CONNOR’S, INC., a Delaware corporation (“Borrower”), and CITY NATIONAL BANK, a national banking association (“Lender”), and in light of the following:

W I T N E S S E T H

WHEREAS, Borrower and Lender are parties to that certain Amended and Restated Loan and Security Agreement, dated as of December 23, 2010 (as amended, restated, supplemented, or otherwise modified from time to time, the “Loan Agreement”);

WHEREAS, Borrower has requested that Lender make certain amendments to the Loan Agreement; and

WHEREAS, upon the terms and conditions set forth herein, Lender is willing to accommodate Borrower’s requests.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement, as amended hereby.

2. Amendments to Loan Agreement.

(a) Section 1.1 to the Loan Agreement is hereby amended by adding the following definitions in the appropriate alphabetical order:

“Maximum Debt Ratio” means, as of any date of determination, the ratio of (a) Total Debt (including all loans and other credit extensions outstanding under this Agreement, but excluding any debt to Shareholder Guarantors (as defined in the Subordinate Credit Agreement)) of Borrower and its Subsidiaries as of such date of determination to (b) TTM Revenue of Borrower and its Subsidiaries as of such date of determination.

“Subordinate Credit Agreement” means that certain Amended and Restated Credit Agreement by and among Borrowers, the lenders from time to time party thereto, and OneWest Bank, FSB, as administrative agent, dated as of April 15, 2013.

“Total Debt” means, as of any date of determination, without duplication, the remainder of (a) all Indebtedness for borrowed money of such Person, determined on a consolidated basis in accordance with GAAP (other than Subordinated Debt (with the exception of Indebtedness pursuant to the Subordinated Credit Agreement), Preferred Stock that is not Prohibited Preferred Stock), including, in any event, but without duplication, with respect to Borrower and its Subsidiaries, the Advances, any Indebtedness pursuant to the Subordinated Credit Agreement and the amount of their Capitalized Lease Obligations, in each case exclusive of Indebtedness owed by one Loan Party to another Loan Party and any Indebtedness in respect of any of the foregoing less (b) all cash and Cash Equivalents on the balance sheet of the Borrower and its Subsidiaries at such date.

“TTM Revenue” means, for the Borrower and its Subsidiaries on a consolidated basis, for the fiscal quarter most recently ended and the immediately preceding three fiscal quarters, consolidated gross revenue.

(b) Section 3.4(a) to the Loan Agreement is hereby amended and restated in its entirety as follows:

“(a) This Agreement shall continue in full force and effect for a term ending on October 31, 2015 (the “Maturity Date”), provided however, if on or before September 30, 2015, Borrower amends its Governing Documents or any other agreements evidencing Borrower’s Preferred Stock, which amendments extend the earliest date when either (i) any holder of Preferred Stock is entitled to request that Borrower redeem such Preferred Stock or (ii) the Borrower is otherwise required to redeem such Preferred Stock to a date that is after February 29, 2016, the Maturity Date shall be automatically extended to December 30, 2015.”

(c) Section 7.18(a)(i) to the Loan Agreement is hereby amended by amending and restating the table appearing therein as follows:

Applicable Ratio	Date
3:00:1.00	June 30, 2013
3:00:1.00	September 30, 2013
3:00:1.00	December 31, 2013
2:50:1.00	March 31, 2014
2:50:1.00	June 30, 2014
2:00:1.00	September 30, 2014
2:00:1.00	December 31, 2014
2:00:1.00	March 31, 2015
2:00:1.00	June 30, 2015
2:00:1.00	September 30, 2015
2:00:1.00	December 31, 2015

(d) Section 7.18 to the Loan Agreement is hereby amended by adding the following new clause (iv) immediately after clause (iii) thereof:

(iv) Maximum Debt Ratio. A Maximum Debt Ratio, measured on a quarter-end basis, of not greater than the applicable ratio set forth in the following table for the applicable date set forth opposite thereto:

Applicable Ratio	Date
1.65:1.00	June 30, 2013
1.65:1.00	September 30, 2013
1.65:1.00	December 31, 2013
1.40:1.00	March 31, 2014
1.40:1.00	June 30, 2014
1.40:1.00	September 30, 2014
1.40:1.00	December 31, 2014
1.15:1.00	March 31, 2015
1.15:1.00	June 30, 2015
1.15:1.00	September 30, 2015
1.15:1.00	December 31, 2015

3. Conditions Precedent to Amendment. The satisfaction of each of the following shall constitute conditions precedent to the effectiveness of the Amendment (such date being the “Amendment Effective Date”):

(a) Lender shall have received this Amendment, duly executed by the parties hereto, and the same shall be in full force and effect.

(b) The representations and warranties herein and in the Loan Agreement and the other Loan Documents shall be true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date).

(c) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein shall have been issued and remain in force by any Governmental Authority against Borrower or Lender.

(d) No Default or Event of Default shall have occurred and be continuing or shall result from the consummation of the transactions contemplated herein.

(e) All other documents and legal matters in connection with the transactions contemplated by this Amendment shall have been delivered, executed, or recorded and shall be in form and substance reasonably satisfactory to Lender.

4. Representations and Warranties. Borrower hereby represents and warrants to Lender as follows:

(a) It (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified reasonably could be expected to result in a Material Adverse Change, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby.

(b) The execution, delivery, and performance by it of this Amendment and the performance by it of each Loan Document to which it is or will be a party (i) have been duly authorized by all necessary action, and (ii) do not and will not (A) violate any material provision of federal, state or local law, rule or regulation, or any order, judgment, decree, writ, injunction or award of any arbitrator, court or governmental authority finding on it or its Subsidiaries, the Governing Documents of it or its Subsidiaries, or any order, judgment or decree of any court or other Governmental Authority binding on it or its Subsidiaries, (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of it or its Subsidiaries, except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Change, (C) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of Borrower, other than Permitted Liens, or (D) require any approval of Borrower’s interestholders or any approval or consent of any Person under any material contractual obligation of Borrower, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of a material contractual obligation, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Change.

(c) The execution, delivery and performance by Borrower of the Loan Documents and the consummation of the transactions contemplated by the Loan Documents do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority other than consents or approvals that have been obtained and that are still in force and effect.

(d) This Amendment is, and each other Loan Document to which it is or will be a party, when executed and delivered by each Person that is a party thereto, will be the legally valid and binding obligation of such Person, enforceable against such Person in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally.

(e) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein has been issued and remains in force by any Governmental Authority against Borrower or Lender.

(f) No Default or Event of Default has occurred and is continuing as of the date of the effectiveness of this Amendment, and no condition exists which constitutes a Default or an Event of Default.

(g) The representations and warranties set forth in this Amendment, the Loan Agreement, as amended by this Amendment, and the other Loan Documents to which it is a party are true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date.)

(h) This Amendment has been entered into without force or duress, of the free will of Borrower, and the decision of Borrower to enter into this Amendment is a fully informed decision and Borrower is aware of all legal and other ramifications of each decision.

(i) It has read and understands this Amendment, has consulted with and been represented by independent legal counsel of its own choosing in negotiations for and the preparation of this Amendment, has read this Amendment in full and final form, and has been advised by its counsel of its rights and obligations hereunder and thereunder.

5. Payment of Costs and Fees. Borrower shall pay to Lender all costs, all out-of-pocket expenses, and all fees and charges of every kind in connection with the preparation, negotiation, execution and delivery of this Amendment and any documents and instruments relating hereto. In addition thereto, Borrower agrees to reimburse Lender on demand for its costs arising out of this Amendment and all documents or instruments relating hereto (which costs may include the reasonable fees and expenses of any attorneys retained by Lender).

6. Choice of Law. This Amendment and the rights of the parties hereunder, shall be governed by, and construed in accordance with, the laws of the State of California applicable to contracts made and to be performed in the State of California.

7. Amendments. This Amendment cannot be altered, amended, changed or modified in any respect or particular unless each such alteration, amendment, change or modification shall have been agreed to by each of the parties and reduced to writing in its entirety and signed and delivered by each party.

8. Counterpart Execution. This Amendment may be executed in any number of counterparts, all of which when taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Amendment by signing any such counterpart. Delivery of an executed counterpart of this Amendment by telefacsimile or electronic mail shall be equally as effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by telefacsimile or electronic mail also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

9. Effect on Loan Documents.

(a) The Loan Agreement, as amended hereby, and each of the other Loan Documents shall be and remain in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. The execution, delivery, and performance of this Amendment shall not operate, except as expressly set forth herein, as a modification or waiver of any right, power, or remedy of Lender under the Loan Agreement or any other Loan Document. The waivers, consents and modifications herein are limited to the specifics hereof (including facts or occurrences on which the same are based), shall not apply with respect to any facts or occurrences other than those on which the same are based, shall not excuse any non-compliance with the Loan Documents, and shall not operate as a consent to any matter under the Loan Documents. Except for the amendments to the Loan Agreement expressly set forth herein, the Loan Agreement and other Loan Documents shall remain unchanged and in full force and effect. The execution, delivery and performance of this Amendment shall not operate as a waiver of or, except as expressly set forth herein, as an amendment of, any right, power or remedy of Lender in effect prior to the date hereof. The amendments and waivers set forth herein are limited to the specifics hereof, shall not apply with respect to any facts or occurrences other than those on which the same are based, and except as expressly set forth herein, shall neither excuse any future non-compliance with the Loan Agreement, nor operate as a waiver of any Default or Event of Default (other than the Designated Events of Default). To the extent any terms or provisions of this Amendment conflict with those of the Loan Agreement or other Loan Documents, the terms and provisions of this Amendment shall control.

(b) Upon and after the effectiveness of this Amendment, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “herein”, “hereof” or words of like import referring to the Loan Agreement, and each reference in the other Loan Documents to “the Loan Agreement”, “thereunder”, “therein”, “thereof” or words of like import referring to the Loan Agreement, shall mean and be a reference to the Loan Agreement as modified and amended hereby.

(c) To the extent that any terms and conditions in any of the Loan Documents shall contradict or be in conflict with any terms or conditions of the Loan Agreement, such terms and conditions are hereby deemed modified or amended accordingly to reflect the terms and conditions of the Loan Agreement as modified or amended hereby.

(d) This Amendment is a Loan Document.

(e) Unless the context of this Amendment clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or”.

10. Entire Agreement. This Amendment, and terms and provisions hereof, the Loan Agreement and the other Loan Documents constitute the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes any and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied, oral or written.

11. Integration. This Amendment, together with the other Loan Documents, incorporates all negotiations of the parties hereto with respect to the subject matter hereof and is the final expression and agreement of the parties hereto with respect to the subject matter hereof.

12. Release.

(a) Effective on the date hereof, each of Borrower and, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on

behalf of, or claiming through such Person, hereby waives, releases, remises and forever discharges Lender, each of its Affiliates, and each of their respective successors in title, past, present and future officers, directors, employees, limited partners, general partners, investors, attorneys, assigns, subsidiaries, shareholders, trustees, agents and other professionals and all other persons and entities to whom Lender would be liable if such persons or entities were found to be liable to Borrower (each a “Releasee” and collectively, the “Releasees”), from any and all past, present and future claims, suits, liens, lawsuits, adverse consequences, amounts paid in settlement, debts, deficiencies, diminution in value, disbursements, demands, obligations, liabilities, causes of action, damages, losses, costs and expenses of any kind or character, whether based in equity, law, contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law (each a “Claim” and collectively, the “Claims”), whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, matured or unmatured, foreseen or unforseen, past or present, liquidated or unliquidated, suspected or unsuspected, which Borrower ever had from the beginning of the world, now has, or might hereafter have against any such Releasee which relates, directly or indirectly to the Loan Agreement, any other Loan Document, or to any acts or omissions of any such Releasee with respect to the Loan Agreement or any other Loan Document, or to the lender-borrower relationship evidenced by the Loan Documents, except for the duties and obligations set forth in this Amendment. As to each and every claim released hereunder, Borrower hereby represents that it has received the advice of legal counsel with regard to the releases contained herein, and having been so advised, specifically waives the benefit of the provisions of Section 1542 of the Civil Code of California which provides as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

(b) Borrower acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agrees that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.

(c) Borrower, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee above that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any claim released, remised and discharged by such Person pursuant to the above release. Borrower further agrees that it shall not dispute the validity or enforceability of the Loan Agreement or any of the other Loan Documents or any of its obligations thereunder, or the validity, priority, enforceability or the extent of Lender’s Lien on any item of Collateral under the Loan Agreement or the other Loan Documents. If Borrower or any of its successors, assigns, or officers, directors, employees, agents or attorneys, or any Person acting for or on behalf of, or claiming through it violate the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys’ fees and costs incurred by such Releasee as a result of such violation.

13. Acknowledgments.

(a) Acknowledgment of Obligations. Each of Borrower and Lender hereby acknowledges, confirms and agrees that as of the close of business on May 3, 2013, Borrower was indebted to Lender for loans and other financial accommodations under the Loan Documents in the aggregate outstanding amount of principal and interest of in respect of the Advances, $15,150,701.38, (which amount is comprised of

$15,000,000.00 of principal outstanding, and $150,701.38 of accrued and unpaid interest) plus out-of-pocket expenses incurred by Lender due and owing under the Loan Documents. All such Obligations owing by Borrower, in each case together with interest accrued and accruing thereon as provided in the Loan Documents, and all fees, costs, expenses and other charges now or hereafter payable by Borrower to Lender (with respect to any fees charged by Lender which are not in respect of out-of-pocket fees and expenses and which have accrued on or before the date hereof, to the extent that Lender has given notice to Borrower of the amount thereof), are unconditionally owing by Borrower to Lender, without offset, defense, withholding, counterclaim or deduction of any kind, nature or description whatsoever and shall be payable in accordance with the terms of the Loan Agreement and the other Loan Documents as amended hereby.

(b) Acknowledgement of Security Interests. Borrower hereby acknowledges, confirms and agrees that Lender has and shall continue to have valid, enforceable and perfected first-priority liens upon and security interests in the Collateral granted to Lender pursuant to the Loan Documents or otherwise granted to or held by Lender.

(c) No Disregard of Loan Documents. Borrower hereby acknowledges that the parties hereto have not entered into a mutual disregard of the terms and provisions of the Loan Agreement or the other Loan Documents, or engaged in any course of dealing in variance with the terms and provisions of the Loan Agreement or the Loan Documents, within the meaning of any applicable law of the State of California, or otherwise.

14. Reaffirmation of Obligations. Borrower hereby reaffirms its obligations under each Loan Document to which it is a party. Borrower hereby further ratifies and reaffirms the validity and enforceability of all of the liens and security interests heretofore granted, pursuant to and in connection with any Loan Document to Lender as collateral security for the obligations under the Loan Documents in accordance with their respective terms, and acknowledges that all of such liens and security interests, and all collateral heretofore pledged as security for such obligations, continues to be and remain collateral for such obligations from and after the date hereof.

15. Ratification. Borrower hereby restates, ratifies and reaffirms each and every term and condition set forth in the Loan Agreement and the Loan Documents effective as of the date hereof and as amended hereby.

16. Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

[Signature pages to follow.]

IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first above written.

PROFESSOR CONNOR’S, INC.,
a Delaware corporation, as Borrower
By:
Name:	Richard A Kassar
Title:	President

[SIGNATURE PAGE TO AMENDMENT NUMBER FOUR TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

CITY NATIONAL BANK,
a national banking association, as Lender
By:
Name:	Garen Papazyan
Title:	Senior Vice President

[SIGNATURE PAGE TO AMENDMENT NUMBER FOUR TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT]

EX-10.10

Exhibit 10.10

AMENDMENT NUMBER FIVE TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

THIS AMENDMENT NUMBER FIVE TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”), dated as of March 14, 2014 is entered into by and between FRESHPET, INC., a Delaware corporation (formerly known as Professor Connor’s, Inc.) (“Borrower”), and CITY NATIONAL BANK, a national banking association (“Lender”), and in light of the following:

W  I  T  N  E  S  S   E  T  H

WHEREAS, Borrower and Lender are parties to that certain Amended and Restated Loan and Security Agreement, dated as of December 23, 2010 (as amended, restated, supplemented, or otherwise modified from time to time, the “Loan Agreement”);

WHEREAS, Borrower has requested that Lender make certain amendments to the Loan Agreement; and

WHEREAS, upon the terms and conditions set forth herein, Lender is willing to accommodate Borrower’s requests.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement, as amended hereby.

2. Amendment to Loan Agreement. Section 1.1 to the Loan Agreement is hereby amended by amending and restating the definition of “Maximum Revolver Amount” in its entirety as follows:

““Maximum Revolver Amount” means $20,000,000.”

3. Conditions Precedent to Amendment. The satisfaction of each of the following shall constitute conditions precedent to the effectiveness of the Amendment (such date being the “Amendment Effective Date”):

(a) Lender shall have received this Amendment, duly executed by the parties hereto, and the same shall be in full force and effect.

(b) The representations and warranties herein and in the Loan Agreement and the other Loan Documents shall be true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date).

(c) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein shall have been issued and remain in force by any Governmental Authority against Borrower or Lender.

(d) No Default or Event of Default shall have occurred and be continuing or shall result from the consummation of the transactions contemplated herein.

(e) All other documents and legal matters in connection with the transactions contemplated by this Amendment shall have been delivered, executed, or recorded and shall be in form and substance reasonably satisfactory to Lender.

4. Representations and Warranties. Borrower hereby represents and warrants to Lender as follows:

(a) It (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified reasonably could be expected to result in a Material Adverse Change, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby.

(b) The execution, delivery, and performance by it of this Amendment and the performance by it of each Loan Document to which it is or will be a party (i) have been duly authorized by all necessary action, and (ii) do not and will not (A) violate any material provision of federal, state or local law, rule or regulation, or any order, judgment, decree, writ, injunction or award of any arbitrator, court or governmental authority finding on it or its Subsidiaries, the Governing Documents of it or its Subsidiaries, or any order, judgment or decree of any court or other Governmental Authority binding on it or its Subsidiaries, (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of it or its Subsidiaries, except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Change, (C) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of Borrower, other than Permitted Liens, or (D) require any approval of Borrower’s interestholders or any approval or consent of any Person under any material contractual obligation of Borrower, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of a material contractual obligation, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Change.

(c) The execution, delivery and performance by Borrower of the Loan Documents and the consummation of the transactions contemplated by the Loan Documents do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority other than consents or approvals that have been obtained and that are still in force and effect.

(d) This Amendment is, and each other Loan Document to which it is or will be a party, when executed and delivered by each Person that is a party thereto, will be the legally valid and binding obligation of such Person, enforceable against such Person in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally.

(e) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein has been issued and remains in force by any Governmental Authority against Borrower or Lender.

(f) No Default or Event of Default has occurred and is continuing as of the date of the effectiveness of this Amendment, and no condition exists which constitutes a Default or an Event of Default.

(g) The representations and warranties set forth in this Amendment, the Loan Agreement, as amended by this Amendment, and the other Loan Documents to which it is a party are true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date.)

(h) This Amendment has been entered into without force or duress, of the free will of Borrower, and the decision of Borrower to enter into this Amendment is a fully informed decision and Borrower is aware of all legal and other ramifications of each decision.

(i) It has read and understands this Amendment, has consulted with and been represented by independent legal counsel of its own choosing in negotiations for and the preparation of this Amendment, has read this Amendment in full and final form, and has been advised by its counsel of its rights and obligations hereunder and thereunder.

5. Payment of Costs and Fees. Borrower shall pay to Lender all costs, all out-of-pocket expenses, and all fees and charges of every kind in connection with the preparation, negotiation, execution and delivery of this Amendment and any documents and instruments relating hereto. In addition thereto, Borrower agrees to reimburse Lender on demand for its costs arising out of this Amendment and all documents or instruments relating hereto (which costs may include the reasonable fees and expenses of any attorneys retained by Lender).

6. Choice of Law. This Amendment and the rights of the parties hereunder, shall be governed by, and construed in accordance with, the laws of the State of California applicable to contracts made and to be performed in the State of California.

7. Amendments. This Amendment cannot be altered, amended, changed or modified in any respect or particular unless each such alteration, amendment, change or modification shall have been agreed to by each of the parties and reduced to writing in its entirety and signed and delivered by each party.

8. Counterpart Execution. This Amendment may be executed in any number of counterparts, all of which when taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Amendment by signing any such counterpart. Delivery of an executed counterpart of this Amendment by telefacsimile or electronic mail shall be equally as effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by telefacsimile or electronic mail also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

9. Effect on Loan Documents.

(a) The Loan Agreement, as amended hereby, and each of the other Loan Documents shall be and remain in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. The execution, delivery, and performance of this Amendment shall not operate, except as expressly set forth herein, as a modification or waiver of any right, power, or remedy of Lender under the Loan Agreement or any other Loan Document. The waivers, consents and modifications herein are limited to the specifics hereof (including facts or occurrences on which the same are based), shall not apply with respect to any facts or occurrences other than those on which the same are based, shall not excuse any non-compliance with the Loan Documents, and shall not operate as a consent to any matter under the Loan Documents. Except for the amendments to the Loan Agreement expressly set forth herein, the Loan Agreement and other Loan Documents shall remain unchanged and in full force and effect. The execution, delivery and performance of this Amendment shall not operate as a waiver of or, except as expressly set forth herein, as an amendment of, any right, power or remedy of Lender in effect prior to the date hereof. The amendments and waivers set forth herein are limited to the specifics hereof, shall not apply with respect to any facts or occurrences other than those on which the same are based, and except as expressly set forth herein, shall neither excuse any future non-compliance with the Loan Agreement, nor operate as a waiver of any Default or Event of Default (other than the Designated Events of Default). To the extent any terms or provisions of this Amendment conflict with those of the Loan Agreement or other Loan Documents, the terms and provisions of this Amendment shall control.

(b) Upon and after the effectiveness of this Amendment, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “herein”, “hereof” or words of like import referring to the Loan Agreement, and each reference in the other Loan Documents to “the Loan Agreement”, “thereunder”, “therein”, “thereof” or words of like import referring to the Loan Agreement, shall mean and be a reference to the Loan Agreement as modified and amended hereby.

(c) To the extent that any terms and conditions in any of the Loan Documents shall contradict or be in conflict with any terms or conditions of the Loan Agreement, such terms and conditions are hereby deemed modified or amended accordingly to reflect the terms and conditions of the Loan Agreement as modified or amended hereby.

(d) This Amendment is a Loan Document.

(e) Unless the context of this Amendment clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or”.

10. Entire Agreement. This Amendment, and terms and provisions hereof, the Loan Agreement and the other Loan Documents constitute the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes any and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied, oral or written.

11. Integration. This Amendment, together with the other Loan Documents, incorporates all negotiations of the parties hereto with respect to the subject matter hereof and is the final expression and agreement of the parties hereto with respect to the subject matter hereof.

12. Release.

(a) Effective on the date hereof, each of Borrower and, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through such Person, hereby waives, releases, remises and forever discharges Lender, each of its Affiliates, and each of their respective successors in title, past, present and future officers, directors, employees, limited partners, general partners, investors, attorneys, assigns, subsidiaries, shareholders, trustees, agents and other professionals and all other persons and entities to whom Lender would be liable if such persons or entities were found to be liable to Borrower (each a “Releasee” and collectively, the “Releasees”), from any and all past, present and future claims, suits, liens, lawsuits, adverse consequences, amounts paid in settlement, debts, deficiencies, diminution in value, disbursements, demands, obligations, liabilities, causes of action, damages, losses, costs and expenses of any kind or character, whether based in equity, law, contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law (each a “Claim” and collectively, the “Claims”), whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, matured or unmatured, foreseen or unforseen, past or present, liquidated or unliquidated, suspected or unsuspected, which Borrower ever had from the beginning of the world, now has, or might hereafter have against any such Releasee which relates, directly or indirectly to the Loan Agreement, any other Loan Document, or to any acts or omissions of any such Releasee with respect to the Loan Agreement or any other Loan Document, or to the lender-borrower relationship evidenced by the Loan Documents, except for the duties and obligations set forth in this Amendment. As to each and every claim released hereunder, Borrower hereby represents that it has received the advice of legal counsel with regard to the releases contained herein, and having been so advised, specifically waives the benefit of the provisions of Section 1542 of the Civil Code of California which provides as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

(b) Borrower acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agrees that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.

(c) Borrower, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee above that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any claim released, remised and discharged by such Person pursuant to the above release. Borrower further agrees that it shall not dispute the validity or enforceability of the Loan Agreement or any of the other Loan Documents or any of its obligations thereunder, or the validity, priority, enforceability or the extent of Lender’s Lien on any item of Collateral under the Loan Agreement or the other Loan Documents. If Borrower or any of its successors, assigns, or officers, directors, employees, agents or attorneys, or any Person acting for or on behalf of, or claiming through it violate the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys’ fees and costs incurred by such Releasee as a result of such violation.

13. Acknowledgments.

(a) Acknowledgment of Obligations. Each of Borrower and Lender hereby acknowledges, confirms and agrees that as of the close of business on February [    ], 2014, Borrower was indebted to Lender for loans and other financial accommodations under the Loan Documents in the aggregate outstanding amount of principal and interest of in respect of the Advances, $[            ], (which amount is comprised of $[            ] of principal outstanding, and $[            ] of accrued and unpaid interest) plus out-of-pocket expenses incurred by Lender due and owing under the Loan Documents. All such Obligations owing by Borrower, in each case together with interest accrued and accruing thereon as provided in the Loan Documents, and all fees, costs, expenses and other charges now or hereafter payable by Borrower to Lender (with respect to any fees charged by Lender which are not in respect of out-of-pocket fees and expenses and which have accrued on or before the date hereof, to the extent that Lender has given notice to Borrower of the amount thereof), are unconditionally owing by Borrower to Lender, without offset, defense, withholding, counterclaim or deduction of any kind, nature or description whatsoever and shall be payable in accordance with the terms of the Loan Agreement and the other Loan Documents as amended hereby.

(b) Acknowledgement of Security Interests. Borrower hereby acknowledges, confirms and agrees that Lender has and shall continue to have valid, enforceable and perfected first-priority liens upon and security interests in the Collateral granted to Lender pursuant to the Loan Documents or otherwise granted to or held by Lender.

(c) No Disregard of Loan Documents. Borrower hereby acknowledges that the parties hereto have not entered into a mutual disregard of the terms and provisions of the Loan Agreement or the other Loan Documents, or engaged in any course of dealing in variance with the terms and provisions of the Loan Agreement or the Loan Documents, within the meaning of any applicable law of the State of California, or otherwise.

14. Reaffirmation of Obligations. Borrower hereby reaffirms its obligations under each Loan Document to which it is a party. Borrower hereby further ratifies and reaffirms the validity and enforceability of all of the liens and security interests heretofore granted, pursuant to and in connection with any Loan Document to Lender as collateral security for the obligations under the Loan Documents in accordance with their respective terms, and acknowledges that all of such liens and security interests, and all collateral heretofore pledged as security for such obligations, continues to be and remain collateral for such obligations from and after the date hereof.

15. Ratification. Borrower hereby restates, ratifies and reaffirms each and every term and condition set forth in the Loan Agreement and the Loan Documents effective as of the date hereof and as amended hereby.

16. Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

[Signature pages to follow.]

IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first above written.

FRESHPET, INC.,

a Delaware corporation (formerly known as Professor Connor’s, Inc.) as Borrower

[SIGNATURE PAGE TO AMENDMENT NUMBER FIVE TO AMENDED AND RESTATED LOAN AND

SECURITY AGREEMENT]

CITY NATIONAL BANK,

a national banking association, as Lender

[SIGNATURE PAGE TO AMENDMENT NUMBER FIVE TO AMENDED AND RESTATED LOAN AND

SECURITY AGREEMENT]

EX-10.11

Exhibit 10.11

AMENDMENT NUMBER SIX TO

AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT

THIS AMENDMENT NUMBER SIX TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”), dated as of September 4, 2014 is entered into by and between FRESHPET, INC., a Delaware corporation (formerly known as Professor Connor’s, Inc.) (“Borrower”), and CITY NATIONAL BANK, a national banking association (“Lender”), and in light of the following:

W  I  T  N  E  S  S   E  T  H

WHEREAS, Borrower and Lender are parties to that certain Amended and Restated Loan and Security Agreement, dated as of December 23, 2010 (as amended, restated, supplemented, or otherwise modified from time to time, the “Loan Agreement”);

WHEREAS, Borrower has requested that Lender make certain amendments to the Loan Agreement; and

WHEREAS, upon the terms and conditions set forth herein, Lender is willing to accommodate Borrower’s requests.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Defined Terms. Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Loan Agreement, as amended hereby.

2. Amendments to Loan Agreement.

(a) Section 1.1 to the Loan Agreement is hereby amended by amending and restating the definition of “Maximum Revolver Amount” in its entirety as follows:

“Maximum Revolver Amount” means, (a) during the period from and after the Restatement Effective Date up to (but not including) the Sixth Amendment Effective Date, $20,000,000, (b) during the period from and including the Sixth Amendment Effective Date up to and including November 30, 2014, $22,000,000, and (c) from and after December 1, 2014, $20,000,000.

(b) Section 1.1 of the Credit Agreement is hereby amended by adding the new defined term “Sixth Amendment Effective Date” in proper alphabetical order therein:

“Sixth Amendment Effective Date” means September 4, 2014.

3. Conditions Precedent to Amendment. The satisfaction of each of the following shall constitute conditions precedent to the effectiveness of the Amendment (such date being the “Amendment Effective Date”):

(a) Lender shall have received this Amendment, duly executed by the parties hereto, and the same shall be in full force and effect.

(b) The representations and warranties herein and in the Loan Agreement and the other Loan Documents shall be true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date).

(c) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein shall have been issued and remain in force by any Governmental Authority against Borrower or Lender.

(d) No Default or Event of Default shall have occurred and be continuing or shall result from the consummation of the transactions contemplated herein.

(e) All other documents and legal matters in connection with the transactions contemplated by this Amendment shall have been delivered, executed, or recorded and shall be in form and substance reasonably satisfactory to Lender.

4. Representations and Warranties. Borrower hereby represents and warrants to Lender as follows:

(a) It (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified reasonably could be expected to result in a Material Adverse Change, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby.

(b) The execution, delivery, and performance by it of this Amendment and the performance by it of each Loan Document to which it is or will be a party (i) have been duly authorized by all necessary action, and (ii) do not and will not (A) violate any material provision of federal, state or local law, rule or regulation, or any order, judgment, decree, writ, injunction or award of any arbitrator, court or governmental authority finding on it or its Subsidiaries, the Governing Documents of it or its Subsidiaries, or any order, judgment or decree of any court or other Governmental Authority binding on it or its Subsidiaries, (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any material contractual obligation of it or its Subsidiaries, except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Change, (C) result in or require the creation or imposition of any Lien of any nature whatsoever upon any properties or assets of Borrower, other than Permitted Liens, or (D) require any approval of Borrower’s interestholders or any approval or consent of any Person under any material contractual obligation of Borrower, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of a material contractual obligation, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Change.

(c) The execution, delivery and performance by Borrower of the Loan Documents and the consummation of the transactions contemplated by the Loan Documents do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority other than consents or approvals that have been obtained and that are still in force and effect.

(d) This Amendment is, and each other Loan Document to which it is or will be a party, when executed and delivered by each Person that is a party thereto, will be the legally valid and binding obligation of such Person, enforceable against such Person in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally.

(e) No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein has been issued and remains in force by any Governmental Authority against Borrower or Lender.

(f) No Default or Event of Default has occurred and is continuing as of the date of the effectiveness of this Amendment, and no condition exists which constitutes a Default or an Event of Default.

(g) The representations and warranties set forth in this Amendment, the Loan Agreement, as amended by this Amendment, and the other Loan Documents to which it is a party are true and correct in all respects on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date.)

(h) This Amendment has been entered into without force or duress, of the free will of Borrower, and the decision of Borrower to enter into this Amendment is a fully informed decision and Borrower is aware of all legal and other ramifications of each decision.

(i) It has read and understands this Amendment, has consulted with and been represented by independent legal counsel of its own choosing in negotiations for and the preparation of this Amendment, has read this Amendment in full and final form, and has been advised by its counsel of its rights and obligations hereunder and thereunder.

5. Payment of Costs and Fees. Borrower shall pay to Lender all costs, all out-of-pocket expenses, and all fees and charges of every kind in connection with the preparation, negotiation, execution and delivery of this Amendment and any documents and instruments relating hereto. In addition thereto, Borrower agrees to reimburse Lender on demand for its costs arising out of this Amendment and all documents or instruments relating hereto (which costs may include the reasonable fees and expenses of any attorneys retained by Lender).

6. Choice of Law. This Amendment and the rights of the parties hereunder, shall be governed by, and construed in accordance with, the laws of the State of California applicable to contracts made and to be performed in the State of California.

7. Amendments. This Amendment cannot be altered, amended, changed or modified in any respect or particular unless each such alteration, amendment, change or modification shall have been agreed to by each of the parties and reduced to writing in its entirety and signed and delivered by each party.

8. Counterpart Execution. This Amendment may be executed in any number of counterparts, all of which when taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Amendment by signing any such counterpart. Delivery of an executed counterpart of this Amendment by telefacsimile or electronic mail shall be equally as effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by telefacsimile or electronic mail also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.

9. Effect on Loan Documents.

(a) The Loan Agreement, as amended hereby, and each of the other Loan Documents shall be and remain in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. The execution, delivery, and performance of this Amendment shall not operate, except as expressly set forth herein, as a modification or waiver of any right, power, or remedy of Lender under the Loan Agreement or any other Loan Document. The waivers, consents and modifications herein are limited to the specifics hereof (including facts or occurrences on which the same are based), shall not apply with respect to any facts or occurrences other than those on which the same are based, shall not excuse any non-compliance with the Loan Documents, and shall not operate as a consent to any matter under the Loan Documents. Except for the amendments to the Loan Agreement expressly set forth herein, the Loan Agreement and other Loan Documents shall remain unchanged and in full force and effect. The execution,

delivery and performance of this Amendment shall not operate as a waiver of or, except as expressly set forth herein, as an amendment of, any right, power or remedy of Lender in effect prior to the date hereof. The amendments and waivers set forth herein are limited to the specifics hereof, shall not apply with respect to any facts or occurrences other than those on which the same are based, and except as expressly set forth herein, shall neither excuse any future non-compliance with the Loan Agreement, nor operate as a waiver of any Default or Event of Default (other than the Designated Events of Default). To the extent any terms or provisions of this Amendment conflict with those of the Loan Agreement or other Loan Documents, the terms and provisions of this Amendment shall control.

(b) Upon and after the effectiveness of this Amendment, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “herein”, “hereof” or words of like import referring to the Loan Agreement, and each reference in the other Loan Documents to “the Loan Agreement”, “thereunder”, “therein”, “thereof” or words of like import referring to the Loan Agreement, shall mean and be a reference to the Loan Agreement as modified and amended hereby.

(c) To the extent that any terms and conditions in any of the Loan Documents shall contradict or be in conflict with any terms or conditions of the Loan Agreement, such terms and conditions are hereby deemed modified or amended accordingly to reflect the terms and conditions of the Loan Agreement as modified or amended hereby.

(d) This Amendment is a Loan Document.

(e) Unless the context of this Amendment clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or”.

10. Entire Agreement. This Amendment, and terms and provisions hereof, the Loan Agreement and the other Loan Documents constitute the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersedes any and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied, oral or written.

11. Integration. This Amendment, together with the other Loan Documents, incorporates all negotiations of the parties hereto with respect to the subject matter hereof and is the final expression and agreement of the parties hereto with respect to the subject matter hereof.

12. Release.

(a) Effective on the date hereof, each of Borrower and, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through such Person, hereby waives, releases, remises and forever discharges Lender, each of its Affiliates, and each of their respective successors in title, past, present and future officers, directors, employees, limited partners, general partners, investors, attorneys, assigns, subsidiaries, shareholders, trustees, agents and other professionals and all other persons and entities to whom Lender would be liable if such persons or entities were found to be liable to Borrower (each a “Releasee” and collectively, the “Releasees”), from any and all past, present and future claims, suits, liens, lawsuits, adverse consequences, amounts paid in settlement, debts, deficiencies, diminution in value, disbursements, demands, obligations, liabilities, causes of action, damages, losses, costs and expenses of any kind or character, whether based in equity, law, contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law (each a “Claim” and collectively, the “Claims”), whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, matured or unmatured, foreseen or unforseen, past or present, liquidated or unliquidated, suspected or unsuspected, which Borrower ever had from the beginning of the world, now has, or might hereafter have against any such Releasee which relates, directly or indirectly to the Loan Agreement,

any other Loan Document, or to any acts or omissions of any such Releasee with respect to the Loan Agreement or any other Loan Document, or to the lender-borrower relationship evidenced by the Loan Documents, except for the duties and obligations set forth in this Amendment. As to each and every claim released hereunder, Borrower hereby represents that it has received the advice of legal counsel with regard to the releases contained herein, and having been so advised, specifically waives the benefit of the provisions of Section 1542 of the Civil Code of California which provides as follows:

“A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR.”

(b) Borrower acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such claims, demands, or causes of action and agrees that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Borrower understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release.

(c) Borrower, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee above that it will not sue (at law, in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any claim released, remised and discharged by such Person pursuant to the above release. Borrower further agrees that it shall not dispute the validity or enforceability of the Loan Agreement or any of the other Loan Documents or any of its obligations thereunder, or the validity, priority, enforceability or the extent of Lender’s Lien on any item of Collateral under the Loan Agreement or the other Loan Documents. If Borrower or any of its successors, assigns, or officers, directors, employees, agents or attorneys, or any Person acting for or on behalf of, or claiming through it violate the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys’ fees and costs incurred by such Releasee as a result of such violation.

13. Acknowledgments.

(a) Acknowledgment of Obligations. Each of Borrower and Lender hereby acknowledges, confirms and agrees that as of the close of business on September 3, 2014, Borrower was indebted to Lender for loans and other financial accommodations under the Loan Documents in the aggregate outstanding amount of principal and interest of in respect of the Advances, $20,202,583.33, (which amount is comprised of $20,000,000 of principal outstanding, and $202,583.33 of accrued and unpaid interest) plus out- of-pocket expenses incurred by Lender due and owing under the Loan Documents. All such Obligations owing by Borrower, in each case together with interest accrued and accruing thereon as provided in the Loan Documents, and all fees, costs, expenses and other charges now or hereafter payable by Borrower to Lender (with respect to any fees charged by Lender which are not in respect of out-of-pocket fees and expenses and which have accrued on or before the date hereof, to the extent that Lender has given notice to Borrower of the amount thereof), are unconditionally owing by Borrower to Lender, without offset, defense, withholding, counterclaim or deduction of any kind, nature or description whatsoever and shall be payable in accordance with the terms of the Loan Agreement and the other Loan Documents as amended hereby.

(b) Acknowledgement of Security Interests. Borrower hereby acknowledges, confirms and agrees that Lender has and shall continue to have valid, enforceable and perfected first-priority liens upon and security interests in the Collateral granted to Lender pursuant to the Loan Documents or otherwise granted to or held by Lender.

(c) No Disregard of Loan Documents. Borrower hereby acknowledges that the parties hereto have not entered into a mutual disregard of the terms and provisions of the Loan Agreement or the other Loan Documents, or engaged in any course of dealing in variance with the terms and provisions of the Loan Agreement or the Loan Documents, within the meaning of any applicable law of the State of California, or otherwise.

14. Reaffirmation of Obligations. Borrower hereby reaffirms its obligations under each Loan Document to which it is a party. Borrower hereby further ratifies and reaffirms the validity and enforceability of all of the liens and security interests heretofore granted, pursuant to and in connection with any Loan Document to Lender as collateral security for the obligations under the Loan Documents in accordance with their respective terms, and acknowledges that all of such liens and security interests, and all collateral heretofore pledged as security for such obligations, continues to be and remain collateral for such obligations from and after the date hereof.

15. Ratification. Borrower hereby restates, ratifies and reaffirms each and every term and condition set forth in the Loan Agreement and the Loan Documents effective as of the date hereof and as amended hereby.

16. Severability. In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

[Signature pages to follow.]

IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date first above written.

FRESHPET, INC.,

a Delaware corporation (formerly known as Professor Connor’s, Inc.) as Borrower

[SIGNATURE PAGE TO AMENDMENT NUMBER SIX TO AMENDED AND RESTATED LOAN AND

SECURITY AGREEMENT]

CITY NATIONAL BANK,

a national banking association, as Lender

[SIGNATURE PAGE TO AMENDMENT NUMBER SIX TO AMENDED AND RESTATED LOAN AND

SECURITY AGREEMENT]

EX-10.19

Exhibit 10.19

EMPLOYMENT AGREEMENT

THIS AGREEMENT is dated as of December 23, 2010, by and between Professor Connor’s, Inc., a Delaware corporation (the “Company”), and Richard Thompson (the “Executive”).

In consideration of the mutual covenants herein contained and of the mutual benefits herein provided, the Company and the Executive agree as follows:

1. Representations and Warranties. The Executive represents and warrants to the Company that Executive is not bound by any restrictive covenants and has no prior or other obligations or commitments of any kind that would in any way prevent, restrict, hinder or interfere with Executive’s acceptance of continued employment or the performance of all duties and services hereunder to the fullest extent of the Executive’s ability and knowledge. The Executive agrees to indemnify and hold harmless the Company for any liability the Company may incur as the result of the existence of any such covenants, obligations or commitments.

2. Term of Employment. The Company will continue to employ the Executive and the Executive accepts continued employment by the Company on the terms and conditions herein contained for a period (the “Employment Period”) provided in Section 5.

3. Duties and Functions.

(a) (1) The Executive shall be employed as the Chief Executive Officer of the Company and shall oversee, direct and manage all operations of the Company. The Executive shall report directly to the Board of Directors (the “Board”). In addition, the Executive shall be elected to and, for so long as he remains employed as Chief Executive Officer, shall continue to be elected a member of the Board of Directors.

(2) The Executive agrees to undertake the duties and responsibilities commensurate with the position of Chief Executive Officer, which may encompass different or additional duties as may, from time to time, be reasonably assigned by the CEO and/or the Board, and the duties and responsibilities undertaken by the Executive may be reasonably altered or modified from time to time by the Board, so long as that Executive’s responsibilities as Chief Executive Officer are not materially reduced, and his reporting relationship is not materially altered or modified in an adverse way.

(b) During the Employment Period, the Executive will devote his full time and efforts to the business of the Company. The Executive may engage in non-competitive business or charitable activities for reasonable periods of time each month so long as such activities do not interfere with the Executive’s responsibilities under this Employment Agreement.

4. Compensation.

(a) Base Salary: As compensation for his services hereunder, during the Executive’s employment as Chief Executive Officer, the Company agrees to pay the Executive a base salary at the rate of Four Hundred Thousand Dollars ($400,000) per annum, payable in accordance with the Company’s normal payroll schedule (which will be no less frequently than one-twelfth of the annual salary amount during each calendar month, which normal payroll schedule shall be the “Normal Payment Schedule”). The Company may withhold from any amounts payable under this Agreement such federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation. In no event shall Executive’s salary be reduced below his current salary (or, subsequent to any increases, below his then current salary).

Executive’s salary shall be subject to annual review, based on corporate policy and contributions made by Executive to the Company.

(b) Participation in Stock Option Program: The Executive shall be eligible to participate in the Company’s equity incentive programs, as such programs may exist on the date hereof or from time to time hereafter, to the same extent as other, similarly situated employees of the Company.

(c) Other Expenses: In addition to the compensation provided for above, the Company agrees to pay or to reimburse the Executive during his employment for all reasonable, ordinary, and necessary, properly vouchered, client-related business or entertainment expenses incurred in the performance of his services hereunder in accordance with Company policy in effect from time to time. The Executive shall submit vouchers and receipts for all expenses for which reimbursement is sought.

Any reimbursements or in-kind benefits to be provided pursuant to this Agreement that are taxable to Executive shall be subject to the following restrictions: (a) each reimbursement must be paid no later than the last day of the calendar year following the Executive’s tax year during which the expense was incurred; (b) the amount of expenses or in-kind benefits provided during a tax year of the Executive may not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other tax year of the Executive; and (c) the right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

(d) Vacation: During each calendar year, the Executive shall be entitled to four (4) weeks of vacation.

(e) Fringe Benefits: In addition to his compensation provided by the foregoing, the Executive shall be entitled to the benefits available generally to Company employees pursuant to, and subject to the terms of, Company programs, including, by way of illustration, personal leave, paid holidays, sick leave, profit-sharing, retirement, disability, dental, vision, group sickness, accident or health insurance programs of the Company which may now or, if not terminated, shall hereafter be in effect, or in any other or additional such programs which may be established by the Company, as and to the extent any such programs are or may from time to time be in effect, as determined by the Company.

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(f) Annual Bonus: The Executive shall participate in any annual cash bonus plan as established by the Board (or a committee thereof) in its sole discretion, which will provide for eligibility to earn a potential annual bonus of up to 50% of Executive’s base salary based on the achievement of preestablished performance goals established by the Board (or a committee thereof) in its sole discretion.

(g) Equity Purchase. Within thirty (30) business days following the date of this Agreement, the Executive (or an entity wholly owned by the Executive) shall invest one million dollars ($1,000,000) in the Company in exchange for the issuance of Series C Preferred Stock of the Company based on a purchase price of $5.25 per share. In addition to the foregoing, at any time during calendar year 2011, the Executive (or an entity wholly owned by the Executive) shall be required to invest an additional one million dollars ($1,000,000) in the Company in exchange for the issuance of additional shares of Series C Preferred Stock of the Company based on a purchase price of $5.25 per share, provided that the parties understand, acknowledge and agree that to the extent that the fair market value of the Series C Preferred Stock of the Company exceeds $5.25 per share at the time of the Executive’s additional investment pursuant to this sentence, such excess shall be treated as ordinary compensatory income at the time of such investment, and the payment of all applicable withholding taxes in respect of such excess shall be a condition to the Company’s obligation to issue the purchased shares. In connection with the issuance of shares of Series C Preferred Stock of the Company as contemplated under this Section 4(g) and as a condition to the Executive’s receipt of such shares, the Company may require the Executive to execute and deliver a stockholder’s agreement or such other documentation that shall set forth certain customary restrictions on transferability and certain other customary securityholder rights and obligations with respect to the shares of Series C Preferred Stock of the Company to be issued. The Executive understands that the Executive’s obligations under this Section 4(g) are a material inducement for the Company entering into this Agreement.

5. Employment Period; Termination.

(a) The Executive’s employment under this Agreement shall continue unabated until terminated by either party pursuant to the terms of this Agreement.

(b) The Employment Period shall continue until terminated upon the earlier to occur of the following events: (i) the close of business on the second anniversary of this Agreement (the initial two (2) year term of this Agreement shall be referred to herein as the “Initial Term”) or (ii) the death or permanent disability (as defined in Section 5(f)) of the Executive or other termination event described in this Section 5, provided, however, that, on the second anniversary of the date of this Agreement, and on every subsequent annual anniversary, and unless either party has given the other party written notice at least ninety (90) days prior to the such anniversary date, the term of this Agreement and the Employment Period shall be renewed for a term ending one (1) year subsequent to such date (each such one-year term shall be referred to herein as a “Renewal Term”), unless sooner terminated as provided herein. For the purposes of this Agreement, the Initial Term and each Renewal Term shall collectively be referred to as the “Employment Period.”

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(c) Notwithstanding the provisions of Sections 5(a) and (b) above, the Executive may terminate the employment relationship at any time for any reason by giving the Company written notice at least thirty (30) days prior to the effective date of termination. Unless otherwise provided by this Section, all compensation and benefits paid by the Company to the Executive shall cease upon his last day of employment; provided, however, that if the Executive terminates his employment for “Good Reason” pursuant to the terms and conditions set forth below, the Company will continue to pay the Executive’s base salary pursuant to the Normal Payment Schedule and the Company will pay the premiums for the Executive’s continuation of group health coverage under the Company’s plans under COBRA at the active employee rates and subject to the Executive’s timely election of COBRA beginning on the date of Executive’s Separation from Service (as defined in Internal Revenue Code Section 409A) for the greater of (i) the remaining term of the Agreement under the then applicable Employment Period, and (ii) a period of twelve (12) months from the effective date of termination (the “Severance Period”), provided, however that there shall be offset any liability for compensation during the Severance Period any compensation paid to the Executive in his capacity as an employee, consultant or independent contractor. The Company may include the premiums for continued health insurance coverage during the Severance Period in the Executive’s taxable income. Executive shall also be entitled to receive any accrued but unpaid salary and bonuses, and to be reimbursed for any reimbursable expenses that have not been reimbursed prior to such termination. Executive’s interest in any outstanding stock options or restricted stock shall remain subject to the terms and conditions of the applicable award agreement (which shall include accelerated vesting of the unvested portion of such awards (if any) that would have become vested during the Initial Term solely by reason of the passage of time (and not the achievement of any applicable performance goal) had the Executive remained in the continued employment of the Company for the duration of the Initial Term). The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

For purposes of this Agreement, “Good Reason” is defined as any one of the following: (i) Company’s material breach of any provision of this Agreement; (ii) any material adverse change in Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities, or any other action by the Company made without Executive’s permission (other than a change due to Executive’s Permanent Disability or as an accommodation under the Americans With Disabilities Act) which results in: (A) a diminution in any material respect in Executive’s position, authority, duties, responsibilities or compensation, which diminution continues in time over at least thirty (30) days, such that it constitutes an effective demotion (provided, however, that no diminution of title, position, duties or responsibilities shall be deemed to occur solely because the Company becomes a subsidiary of another corporation or entity); or (B) a material diversion from Executive’s performance of the functions of Executive’s position (including but not necessarily limited to Executive’s authority

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to hire, direct, and/or fire employees, Executive’s authority to oversee the general direction and focus of the Company), excluding for this purpose material adverse changes made with Executive’s written consent or due to Executive’s termination For Cause or termination by Executive without Good Reason; or (iii) relocation of the Company’s headquarters to a location which requires him to travel more than thirty (30) additional miles from Executive’s residence than Executive must already travel to arrive at the Company’s headquarters without Executive’s written consent; provided, however, that it shall not constitute Good Reason unless Executive shall have provided the Company with written notice of its alleged actions constituting Good Reason (which notice shall specify in reasonable detail the particulars of such Good Reason) and Company has not cured any such alleged Good Reason within 30 days of Company’s receipt of such written notice. For the avoidance of doubt, a termination of the Executive’s employment as a result of a non-renewal of this Agreement by the Executive pursuant to Section 5(b)) shall be deemed a voluntary resignation without Good Reason for all purposes hereunder.

(d) If the Executive’s employment is terminated for “Cause,” the Executive shall not be entitled to receive severance pay. As used in this Agreement, the term “Cause” shall include a termination for (i) fraud (including but not limited to any acts of embezzlement or misappropriation of funds); (ii) breach of fiduciary obligation; (iii) conviction of a felony, plea of guilty or nolo contendere to a felony charge or any criminal act involving moral turpitude (which, through lapse of time or otherwise, is not subject to appeal); (iv) repeatedly being under the influence of drugs or alcohol (other than prescription medicine or other medically-related drugs to the extent that they are taken in accordance with their directions) during the performance of his duties under this Agreement, or, while under the influence of such drugs or alcohol, engaging in grossly inappropriate conduct during the performance of his duties under this Agreement; (v) a refusal to substantially perform the Executive’s duties hereunder, (vi) willful misconduct or gross negligence, or (vii) material breach of this Agreement, except in the event that the Executive becomes permanently disabled as set forth in Section 5(f). Anything herein to the contrary notwithstanding, the Company shall give the Executive written notice prior to terminating this Agreement of the Executive’s employment based upon a serious dereliction of fiduciary obligation or refusal to perform ((ii) or (v) above), setting forth the exact nature of any such alleged serious dereliction of duty or refusal to perform and the conduct required to cure such breach. The Executive shall have thirty (30) days from the giving of such notice within which to cure. The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

(e) Upon sixty (60) days written notice, the Company shall retain the right to terminate the Executive without Cause (which, for the avoidance of doubt, shall not include a non-renewal of this Agreement by the Company pursuant to Section 5(b)). If the Executive’s employment is terminated by the Company without Cause, the Executive shall continue to receive his base salary pursuant to the Normal Payment Schedule and the Company will pay the premiums for the Executive’s continuation of group health coverage under the Company’s plans under COBRA at the active employee rates and subject to the Executive’s timely election of

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COBRA beginning on the date of Executive’s Separation from Service (as defined in Internal Revenue Code Section 409A) for the Severance Period, provided, however that there shall be offset any liability for compensation during the Severance Period any compensation paid to the Executive in his capacity as an employee, consultant or independent contractor. The Company may include the premiums for continued health insurance coverage during the Severance Period in the Executive’s taxable income. Executive’s interest in any outstanding stock options or restricted stock shall remain subject to the terms and conditions of the applicable award agreement (which shall include accelerated vesting of the unvested portion of such awards (if any) that would have become vested during the Initial Term solely by reason of the passage of time (and not the achievement of any applicable performance goal) had the Executive remained in the continued employment of the Company for the duration of the Initial Term). The non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section. The confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

(f) In the event the Executive becomes permanently disabled during employment with the Company, the Company may terminate this Agreement by giving thirty (30) days notice to the Executive of its intent to terminate, and unless the Executive resumes performance of the duties set forth in Section 3 within five (5) days of the date of the notice and continues performance for the remainder of the notice period, this Agreement shall terminate at the end of the thirty (30) day period. If the Executive is terminated pursuant to this Section 5(f), he shall be entitled to receive severance pay in an amount equal to the salary that the Executive would have received for a period equal to the Severance Period, less all applicable withholding and deductions. The Company will pay the premiums for the Executive’s continuation of group health coverage under the Company’s plans under COBRA at the active employee rates and subject to the Executive’s timely election of COBRA for a period equal to the Severance Period. The Company may include the premiums for continued health insurance coverage in the Executive’s taxable income. Executive’s interest in any outstanding stock options or restricted stock shall remain subject to the terms and conditions of the applicable award agreement (which shall include accelerated vesting of the unvested portion of such awards (if any) that would have become vested during the Initial Term solely by reason of the passage of time (and not the achievement of any applicable performance goal) had the Executive remained in the continued employment of the Company for the duration of the Initial Term). The severance pay shall be payable beginning on the date of the Executive’s Separation from Service (as defined in Internal Revenue Code Section 409A) in accordance with the Company’s Normal Payroll Schedule, as if Executive’s employment had continued during the applicable severance period. “Permanently disabled” for the purposes of this Agreement means the inability, due to physical or mental ill health, to perform the Executive’s duties for one hundred twenty (120) days during any one employment year, irrespective of whether such days are consecutive. In the event of any dispute under this Section, the Executive shall submit to a physical examination by a licensed physician mutually satisfactory to the Company and the Executive, the cost of such examination to be paid by the Company, and the determination of such physician shall be determinative. The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in

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Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

(g) This Agreement will terminate immediately upon the Executive’s death and the Company shall not have any further liability or obligation to the Executive, his executors, heirs, assigns or any other person claiming under or through his estate, except that Executive’s estate shall receive any accrued but unpaid salary or bonuses. Executive’s interest in any outstanding stock options or restricted stock shall remain subject to the terms and conditions of the applicable award agreement following his termination under this Section 5(g) (which shall include accelerated vesting of the unvested portion of such awards (if any) that would have become vested during the Initial Term solely by reason of the passage of time (and not the achievement of any applicable performance goal) had the Executive remained in the continued employment of the Company for the duration of the Initial Term).

(h) The severance benefits under Section 5(c), 5(e) and 5(f) shall only be payable if the Executive delivers to the Company and does not revoke a general release of claims in favor of the Company in a form reasonably satisfactory to the Company. Such release shall be executed and delivered (and no longer subject to revocation, if applicable) within sixty (60) days following termination. Notwithstanding the provisions of Section 5(c), 5(e) and 5(f), to the extent that the payment of any severance amount subject to the release requirement under this Section 5(h) constitutes “nonqualified deferred compensation” for purposes of 409A (as defined in Section 17(d)), any such payment scheduled to occur during the first sixty (60) days following termination of employment shall not be paid until the sixtieth (60^th) day following such termination and shall include payment of any amount that was otherwise scheduled to be paid prior thereto.

6. Company Property. All correspondence, records, documents, software, promotional materials, and other Company property, including all copies, which come into the Executive’s possession by, through or in the course of his employment, regardless of the source and whether created by the Executive, are the sole and exclusive property of the Company, and immediately upon the termination of the Executive’s employment, or any time at the Company’s request, the Executive shall return to the Company all such property of the Company.

7. Non-Competition; Non-Solicitation.

(a) The Executive agrees that, in consideration of his employment with the Company pursuant to this Agreement, and other good and valuable consideration, the receipt of which is hereby acknowledged, during Executive’s employment with the Company and for twelve (12) months after termination thereof, the Executive will not either on his own behalf or on behalf of any third party, except on behalf of the Company, directly or indirectly (other than through his ownership of equity interest in the Company), as an individual proprietor, partner, stockholder, officer, employee, director, joint venturer, investor, lender, or in any other capacity whatsoever (other than as the holder of not more than five percent (5%) of the total outstanding

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stock of a publicly-held company), (i) engage in the manufacture, sale or distribution of cat and dog food and treats; (ii) divert, take away, or attempt to divert or take away, the business or patronage (with respect to products or services of the kind or type developed, produced, marketed, furnished or sold by the Company) of any of the Company’s clients, customers, vendors, business or strategic partners, or accounts, or prospective clients, customers, vendors, business or strategic partners, or accounts, that were contacted, solicited, or served by the Executive while employed by the Company, or (iii) persuade any client, customer, vendor, strategic or business partner, or account of the Company to cease to do business, invest in, participate with, or otherwise work with the Company, or to reduce the amount of business, investment, participation or work that any such client, customer, vendor, or strategic or business partner has customarily done or actively contemplates doing with the Company.

(b) During the Executive’s employment with the Company and for twelve (12) months after termination thereof, the Executive agrees that the Executive shall not, except in the furtherance of the Executive’s duties hereunder, directly or indirectly, individually or on behalf of any other person, firm, corporation or other entity, solicit, aid or induce any employee, representative or agent of the Company or any of its affiliates to leave such employment or retention or to accept employment with or render services to or with any other person, firm, corporation or other entity unaffiliated with the Company or hire or retain any such employee, representative or agent, or take any action to materially assist or aid any other person, firm, corporation or other entity in identifying, hiring or soliciting any such employee, representative or agent. An employee, representative or agent shall be deemed covered by this Section 7(b) while so employed or retained and for a period of six (6) months thereafter.

(c) If any restriction set forth in Section 7 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or geographic area, it shall be interpreted to extend over the maximum period of time, range of activities or geographic areas as to which it may be enforceable.

(d) The Executive acknowledges and agrees that the Company’s remedies at law for a breach or threatened breach of any of the provisions of Section 7 or Section 8 would be inadequate and, in recognition of this fact, the Executive agrees that, in the event of such a breach or threatened breach, in addition to any remedies at law, the Company, without posting any bond or other security, shall be entitled to obtain equitable relief in the form of specific performance, a temporary restraining order, a temporary or permanent injunction or any other equitable remedy which may then be available, without the necessity of showing actual monetary damages. In the event of a violation by the Executive of Section 7 or Section 8, any severance being paid to the Executive pursuant to this Agreement or otherwise shall immediately cease.

(e) The provisions of Section 7 and Section 8 shall survive termination of this Agreement.

8. Protection of Confidential Information. The Executive agrees that all information, whether or not in writing, relating to the business, technical, or financial affairs of the Company and that is generally understood in the cat and dog food and treats industry (and any other related or relevant industry) as being confidential and/or proprietary information, is the

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exclusive property of the Company. The Executive agrees to hold in a fiduciary capacity for the sole benefit of the Company all secret, confidential or proprietary information, knowledge, data, or trade secret (“Confidential Information”) relating to the Company or any of its affiliates or their respective clients, which Confidential Information shall have been obtained during his employment with the Company. By way of illustration, but not limitation, Confidential Information includes information regarding the Company’s projects, methodologies, business or vendor relationships, relationships with strategic or business partners, and all information and know-how (whether or not patentable, copyrightable or otherwise able to be registered or protected under laws governing intellectual property) owned, possessed, or used by the Company, including, without limitation, any invention, existing or future product, formula, method, manufacturing techniques and procedures, composition, compound, project, development, plan, market research, vendor information, supplier information, customer lists or information, apparatus, equipment, trade secret, process, research, reports, clinical data, financial data, technical data, test data, know-how, computer program, software, software documentation, source code, hardware design, technology, marketing or business plan, forecast, unpublished financial statement, budget, license, patent applications, contracts, joint ventures, price, cost and personnel data, any trade names, trademarks or slogans, but shall not include information that (i) is or becomes public knowledge through legal means without fault by the Executive, (ii) is already public knowledge prior to the signing of this Agreement, (iii) was available to the Executive on a non-confidential basis prior to its disclosure by the Company, (iv) was disclosed by the Executive in the performance of his duties hereunder, or (v) must be disclosed pursuant to applicable law or court order.

The Executive agrees that he will not at any time, either during the Term of this Agreement or after its termination, except as reasonably necessary in the scope and course of his duties, disclose to anyone any Confidential Information, or utilize such Confidential Information for his own benefit, or for the benefit of third parties without written approval by an officer of the Company. Executive further agrees that all memoranda, notes, records, data, schematics, sketches, computer programs, prototypes, or written, photographic, magnetic or other documents or tangible objects compiled by him or made available to him during the Term of his employment concerning the business of the Company and/or its clients, including any copies of such materials, shall be the property of the Company and shall be delivered to the Company on the termination of his employment, or at any other time upon request of the Company.

9. Publicity. Neither party shall issue, without consent of the other party, any press release or make any public announcement with respect to this Agreement or the employment relationship between them. Following the date of this Agreement and regardless of any dispute that may arise in the future, the Executive and the Company jointly and mutually agree that they will not disparage, criticize or make statements which are negative, detrimental or injurious to the other to any individual, company or client, including within the Company.

10. Binding Agreement. This Agreement shall be binding upon and inure to the benefit of the parties hereto, their heirs, personal representatives, successors and assigns. In the event the Company is acquired, is a non surviving party in a merger, or transfers substantially all of its assets, this Agreement shall not be terminated and the transferee or surviving company shall be bound by the provisions of this Agreement. The parties understand that the obligations of the Executive are personal and may not be assigned by him.

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11. Entire Agreement. This Agreement contains the entire understanding of the Executive and the Company with respect to employment of the Executive and supersedes any and all prior understandings, written or oral. This Agreement may not be amended, waived, discharged or terminated orally, but only by an instrument in writing, specifically identified as an amendment to this Agreement, and signed by all parties. By entering into this Agreement, the Executive certifies and acknowledges that he has carefully read all of the provisions of this Agreement and that he voluntarily and knowingly enters into said Agreement. Nothing contained herein shall be deemed to limit or modify the rights of Executive under that certain Stock Purchase and Sale Agreement and that certain Stockholders Agreement among the Company and certain of stockholders, both dated December 23, 2010.

12. Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be deemed severable from the remainder of this Agreement, and the remaining provisions contained in this Agreement shall be construed to preserve to the maximum permissible extent the intent and purposes of this Agreement. Any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

13. Governing Law and Submission to Jurisdiction. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, without giving effect to the principles of conflicts of law thereof.

14. Notices. Any notice provided for in this Agreement shall be provided in writing. Notices shall be effective from the date of service, if served personally on the party to whom notice is to be given, or on the second day after mailing, if mailed by first class mail, postage prepaid. Notices shall be properly addressed to the parties at their respective addresses or to such other address as either party may later specify by notice to the other.

15. ARBITRATION. THE PARTIES AGREE THAT ANY CONTROVERSY, CLAIM OR DISPUTE ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE BREACH THEREOF, EXCEPT AS DISCUSSED HEREIN OR ARISING OUT OF OR RELATING TO THE EMPLOYMENT OF THE EXECUTIVE, OR THE TERMINATION THEREOF, INCLUDING ANY STATUTORY OR COMMON LAW CLAIMS UNDER FEDERAL, STATE, OR LOCAL LAW, INCLUDING ALL LAWS PROHIBITING DISCRIMINATION IN THE WORKPLACE, SHALL BE RESOLVED BY ARBITRATION IN NEW YORK IN ACCORDANCE WITH THE EMPLOYMENT DISPUTE RESOLUTION RULES OF JAMS/ENDISPUTE. THE PARTIES AGREE THAT ANY AWARD RENDERED BY THE ARBITRATOR SHALL BE FINAL AND BINDING, AND THAT JUDGMENT UPON THE AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION THEREOF. THE PARTIES FURTHER ACKNOWLEDGE AND AGREE THAT, DUE TO THE NATURE OF THE CONFIDENTIAL INFORMATION, TRADE SECRETS, AND INTELLECTUAL PROPERTY BELONGING TO THE COMPANY TO WHICH THE EXECUTIVE HAS

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OR WILL BE GIVEN ACCESS, AND THE LIKELIHOOD OF SIGNIFICANT HARM THAT THE COMPANY WOULD SUFFER IN THE EVENT THAT SUCH INFORMATION WAS DISCLOSED TO THIRD PARTIES, NOTHING IN THIS SECTION SHALL PRECLUDE THE COMPANY FROM GOING TO COURT TO SEEK INJUNCTIVE RELIEF TO PREVENT EXECUTIVE FROM VIOLATING THE OBLIGATIONS ESTABLISHED IN SECTIONS 7 THROUGH 9 OF THIS AGREEMENT.

16. Indemnification. In his capacity as a director, manager, officer, or employee of the Company or serving or having served any other entity as a director, manager, officer, or Executive at the Company’s request, Executive shall be indemnified and held harmless by the Company to the fullest extent allowed by law, the Company’s charter and by-laws, from and against any and all losses, claims, damages, liabilities, expenses (including legal fees and expenses), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative, in which Executive may be involved, or threatened to be involved, as a party or otherwise by reason of Executive’s status, which relate to or arise out of the Company, their assets, business or affairs, unless in each of the foregoing cases, a court of competent jurisdiction has finally determined that (i) Executive did not act in good faith and in a manner Executive believed to be in, or not opposed to, the best interests of the Company, and, with respect to any criminal proceeding, had reasonable cause to believe Executive’s conduct was unlawful, and (ii) Executive’s conduct constituted gross negligence or willful or wanton misconduct (and the Company shall also advance expenses as incurred to the fullest extent permitted under applicable law, provided Executive provides an undertaking to repay advances if it is ultimately determined that Executive is not entitled to indemnification). The Company shall advance all expenses incurred by Executive in connection with the investigation, defense, settlement or appeal of any civil or criminal action or proceeding referenced in this Section, including but not necessarily limited to legal counsel, expert witnesses or other litigation-related expenses. Executive shall be entitled to coverage under the Company’s directors and officers liability insurance policy in effect at any time in the future to no lesser extent than any other officers or directors of the Company. After Executive is no longer employed by the Company, the Company shall keep in effect the provisions of this Section, which provision shall not be amended except as required by applicable law or except to make changes permitted by law that would enlarge the right of indemnification of Executive. Notwithstanding anything herein to the contrary, the provisions of this Section shall survive the termination of this Agreement and the termination of the Employment Period for any reason.

17. Miscellaneous.

(a) No delay or omission by either party in exercising any right under this Agreement shall operate as a waiver of that or any other right. A waiver or consent given by one party on any one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of any right on any other occasion.

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(b) The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.

(c) Any rights of Executive hereunder shall be in addition to any rights Executive may otherwise have under written benefit plans or agreements of the Company to which he is a party or in which he is a participant, including, but not limited to, any Company sponsored written employee benefit plans, stock option plans, grants and agreements.

(d) Notwithstanding any provision in this Agreement to the contrary, this Agreement shall be interpreted and administered in accordance with Section 409A of the Internal Revenue Code of 1986, as amended, and regulations and other guidance issued thereunder (all of which shall be referred to as “409A”), to the extent applicable. For purposes of determining whether any payment made pursuant to this Agreement results in a “deferral of compensation” within the meaning of Treasury Regulation §1.409A-1(b), the exemptions described in such section shall be maximized, as applicable. If Executive is a specified employee (as defined in Treasury Regulation §1.409A-1(i)) upon separation from service (as defined in Treasury Regulation §1.409A-1(h)), then payment of any amount that is deferred compensation and is subject to 409A shall be delayed for a period that ends on the earlier of death of the specified employee or the day following six months after the date of separation from service and paid in a lump sum on the first payroll payment date following expiration of such period (but no later than 90 days after such period). For purposes of conforming this Agreement to 409A, the parties agree that any reference to termination of employment, severance from service or similar terms shall mean a “separation from service” as defined in Treasury Regulation §1.409A-1(h), and the right to a series of installment payments under this Agreement shall be treated as a right to a series of separate payments.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be duly executed and delivered under seal, by its authorized officers or individually, on the date first identified above.

PROFESSOR CONNOR’S, INC.:
/s/ Richard Kassan
By:	Richard Kassan
Title:	President
RICHARD THOMPSON:
/s/ Richard Thompson

[SIGNATURE PAGE TO THOMPSON EMPLOYMENT AGREEMENT]

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EX-10.20

Exhibit 10.20

EMPLOYMENT AGREEMENT

THIS AGREEMENT is dated as of October 25, 2006, by and between Professor Connor’s, Inc., a Delaware corporation (the “Company”), and Scott Morris (the “Executive”).

In consideration of the mutual covenants herein contained and of the mutual benefits herein provided, the Company and the Executive agree as follows:

1. Representations and Warranties. The Executive represents and warrants to the Company that Executive is not bound by any restrictive covenants and has no prior or other obligations or commitments of any kind that would in any way prevent, restrict, hinder or interfere with Executive’s acceptance of continued employment or the performance of all duties and services hereunder to the fullest extent of the Executive’s ability and knowledge. The Executive agrees to indemnify and hold harmless the Company for any liability the Company may incur as the result of the existence of any such covenants, obligations or commitments.

2. Term of Employment. The Company will continue to employ the Executive and the Executive accepts continued employment by the Company on the terms and conditions herein contained for a period (the “Employment Period”) provided in Section 5.

3. Duties and Functions.

(a) (1) The Executive shall be employed as the Vice-President of Marketing of the Company and shall oversee, direct and manage all marketing operations of the Company. The Executive shall report directly to the Chief Executive Officer (the “CEO”).

(2) The Executive agrees to undertake the duties and responsibilities commensurate with the position of Vice-President of Marketing, which may encompass different or additional duties as may, from time to time, be reasonably assigned by the CEO and/or the Board, and the duties and responsibilities undertaken by the Executive maybe reasonably altered or modified from time to time by the Board, so long as that Executive’s responsibilities as Vice-President of Marketing are not materially reduced, and his reporting relationship is not materially altered or modified in an adverse way.

(b) During the Employment Period, the Executive will devote his time and efforts to the business of the Company. The Executive may engage in non-competitive business or charitable activities for reasonable periods of time each month so long as such activities do not interfere with the Executive’s responsibilities under this Employment Agreement.

4. Compensation.

(a) Base Salary: As compensation for his services hereunder, during the Executive’s employment as Vice-President of Marketing, the Company agrees to pay the Executive a base salary at the rate of Two Hundred Thousand Dollars ($200,000) per annum,

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payable in accordance with the Company’s normal payroll schedule, or on such other periodic basis as may be mutually agreed upon. The Company may withhold from any amounts payable under this Agreement such federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation. In no event shall Executive’s salary be reduced below his current salary (or, subsequent to any increases, below his then current salary).

Executive’s salary shall be subject to annual review, based on corporate policy and contributions made by Executive to the Company.

(b) Participation in Stock Option Program: The Executive shall be eligible to participate in the Company’s equity incentive programs, as such programs may exist on the date hereof or from time to hereafter, to the same extent as other, similarly situated employees of the Company.

(c) Other Expenses: In addition to the compensation provided for above, the Company agrees to pay or to reimburse the Executive during his employment for all reasonable, ordinary, and necessary, properly vouchered, client-related business or entertainment expenses incurred in the performance of his services hereunder in accordance with Company policy in effect from time to time. The Executive shall submit vouchers and receipts for all expenses for which reimbursement is sought.

(d) Vacation: During each calendar year, the Executive shall be entitled to four (4) weeks of vacation.

(e) Fringe Benefits: In addition to his compensation provided by the foregoing, the Executive shall be entitled to the benefits available generally to Company employees pursuant to Company programs, including, by way of illustration, personal leave, paid holidays, sick leave, profit-sharing, retirement, disability, dental, vision, group sickness, accident or health insurance programs of the Company which may now or, if not terminated, shall hereafter be in effect, or in any other or additional such programs which maybe established by the Company, as and to the extent any such programs are or may from time to time be in effect, as determined by the Company and the terms hereof.

5. Employment Period; Termination.

(a) The Executive’s employment under this Agreement shall continue thereafter unabated until terminated by either party pursuant to the terms of this Agreement.

(b) The Employment Period shall continue until terminated upon the earlier to occur of the following events: (i) the close of business on the third anniversary of this Agreement (the initial three (3) year term of this Agreement shall be referred to herein as the “Initial Term”) or (ii) the death or permanent disability (as defined in Section 5 (f)) of the Executive, provided, however, that, on the third anniversary of the date of this Agreement, and on every subsequent annual anniversary, and unless either party has given the other party written notice at least ninety (90) days prior to the such anniversary date, the term of this Agreement and the Employment Period shall be renewed for a term ending one (1) year subsequent to such date (each such one-year term shall be referred to herein as a “Renewal Term”), unless sooner terminated as provided herein. For the purposes of this Agreement, the Initial Term and each Renewal Term shall collectively be referred to as the “Employment Period.”

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(c) Notwithstanding the provisions of Sections 5(a) and (b) above, the Executive may terminate the employment relationship at any time for any reason by giving the Company written notice at least thirty (30) days prior to the effective date of termination. Unless otherwise provided by this Section, all compensation and benefits paid by the Company to the Executive shall cease upon his last day of employment; provided, however, that if the Executive terminates his employment for “Good Reason” pursuant to the terms and conditions set forth below, the Company will continue to pay the Executive’s base salary and medical benefits for the greater of (i) the remaining term of the Agreement under the then applicable Employment Period, or (ii) a period of twelve (12) months from the effective date of termination, provided, however, that there shall be offset against any liability for compensation during any period more than twelve (12) months from the date of such termination any compensation paid to the Executive in his capacity as an employee, consultant or independent contractor, and Executive’s interest in any stock options or restricted stock for which he has become eligible under the terms of the applicable stock option plan or agreement shall fully vest on the effective date of his termination. Executive shall also be entitled to receive any accrued but unpaid salary and bonuses, and to be reimbursed for any reimbursable expenses that have not been reimbursed prior to such termination. The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

For purposes of this Agreement, “Good Reason” is defined as any one of the following: (i) Company’s material breach of any provision of this Agreement; (ii) any material adverse change in Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities, or any other action by the Company made without Executive’s permission (other than a change due to Executive’s Permanent Disability or as an accommodation under the Americans With Disabilities Act) which results in: (A) a diminution in any material respect in Executive’s position, authority, duties, responsibilities or compensation, which diminution continues in time over at least thirty (30) days, such that it constitutes an effective demotion (provided, however, that no diminution of title, position, duties or responsibilities shall be deemed to occur solely because the Company becomes a subsidiary. of another corporation or entity); or (B) a material diversion from Executive’s performance of the functions of Executive’s position (including but not necessarily limited to Executive’s authority to hire, direct, and/or fire employees, Executive’s authority to oversee the general direction and focus of the Company), excluding for this purpose material adverse changes made with Executive’s written consent or due to Executive’s termination For Cause or termination by Executive without Good Reason; or (iii) relocation of the Company’s headquarters to a location which requires him to travel more than thirty (30) additional miles from Executive’s residence than Executive must already travel to arrive at the Company’s headquarters without Executive’s written consent; provided, however, that it shall not constitute Good Reason unless Executive

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shall have provided the Company with written notice of its alleged actions constituting Good Reason (which notice shall specify in reasonable detail the particulars of such Good Reason) and Company has not cured any such alleged Good Reason within 30 days of Company’s receipt of such written notice.

(d) If the Executive’s employment is terminated for “Cause,” the Executive shall not be entitled to receive severance pay. As used in this Agreement, the term “Cause” shall include a termination for (i) fraud (including but not limited to any acts of embezzlement or misappropriation of funds); (ii) serious dereliction of fiduciary obligation; (iii) conviction of a felony, plea of guilty or nolo contendere to a felony charge or any criminal act involving moral turpitude (which, through lapse of time or otherwise, is not subject to appeal); (iv) repeatedly being under the influence of drugs or alcohol (other than prescription medicine or other medically-related drugs to the extent that they are taken in accordance with their directions) during the performance of his duties under this Agreement, or, while under the influence of such drugs or alcohol, engaging in grossly inappropriate conduct during the performance of his duties under this Agreement; or (v) a refusal to substantially perform the Executive’s duties hereunder, except in the event that the Executive becomes permanently disabled as set forth in Section 5(f). Anything herein to the contrary notwithstanding, the Company shall give the Executive written notice prior to terminating this Agreement of the Executive’s employment based upon a serious dereliction of fiduciary obligation or refusal to perform ((ii) or (v) above), setting forth the exact nature of any such alleged serious dereliction of duty or refusal to perform and the conduct required to cure such breach. The Executive shall have thirty (30) days from the giving of such notice within which to cure. The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

(e) Upon sixty (60) days written notice, the Company shall retain the right to terminate the Executive without Cause. If the Executive’s employment is terminated by the Company without Cause, the Executive shall continue to receive his base salary and fringe/medical benefits as provided for in Section 4 (collectively, the “Fringe Benefits”) for the greater of (i) the remaining term of the Agreement under the then applicable Employment Period, or (ii) a period of twelve (12) months from the effective date of termination, provided, however, that there shall be offset against any liability for compensation during any period more than twelve (12) months from the date of such termination any compensation paid to the Executive in his capacity as an employee, consultant or independent contractor. Furthermore, Executive’s interest in any stock options or restricted stock for which he has become eligible under the terms of the applicable stock option or restricted stock plan or agreement or for which he was scheduled to become eligible at any time during the then applicable Employment Period (collectively, the “Options”) shall fully vest on the effective date of his termination without Cause. The non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will terminate on the effective date of termination if Executive’s employment with the Company is terminated pursuant to this Section 5(e). The confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

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(f) In the event the Executive becomes permanently disabled during employment with the Company, the Company may terminate this Agreement by giving thirty (30) days notice to the Executive of its intent to terminate, and unless the Executive resumes performance of the duties set forth in Section 3 within five (5) days of the date of the notice and continues performance for the remainder of the notice period, this Agreement shall terminate at the end of the thirty (30) day period. If the Executive is terminated pursuant to this Section 5(f), he shall be entitled to receive severance pay in an amount equal to twelve (12) months of salary, less all applicable withholding and deductions, and Executive shall be entitled to receive all stock options and the Fringe Benefits as if Executive’s employment had continued through the twelve (12) month period following termination. This severance pay shall be payable in accordance with the Company’s normal payroll schedule, or on such other periodic basis as may be mutually agreed upon, from the effective date of his termination, as if Executive’s employment had continued during the twelve (12) month severance period. “Permanently disabled” for the purposes of this Agreement means the inability, due to physical or mental ill health, to perform the Executive’s duties for one hundred twenty (120) days during any one employment year, irrespective of whether such days are consecutive. In the event of any dispute under this Section, the Executive shall submit to a physical examination by a licensed physician mutually satisfactory to the Company and the Employee, the cost of such examination to be paid by the Company, and the determination of such physician shall be determinative. The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

(g) This Agreement will terminate immediately upon the Executive’s death and the Company shall not have any further liability or obligation to the Employee, his executors, heirs, assigns or any other person claiming under or through his estate, except that Executive’s estate shall receive any accrued but unpaid salary or bonuses, and Executive’s interest in any stock options or restricted stock for which he had become eligible under the terms of the applicable stock option or restricted stock plan or agreement or for which he was scheduled to become eligible at any time during the then applicable Employment Period under the terms of any such stock option or restricted stock plan or agreement (collectively, the “Options”) shall fully vest on the effective date of his termination under this Section 5(g).

6. Company Property. All correspondence, records, documents, software, promotional materials, and other Company property, including all copies, which come into the Executive’s possession by, through or in the course of his employment, regardless of the source and whether created by the Executive, are the sole and exclusive property of the Company, and immediately upon the termination of the Executive’s employment, or any time at the Company’s request, the Executive shall return to the Company all such property of the Company.

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7. Non-Competition.

(a) The Executive agrees that, in consideration of his employment with the Company pursuant to this Agreement, and other good and valuable consideration, the receipt of which is hereby acknowledged, during Employee’s employment with the Company and for twelve (12) months after termination thereof, the Employee will not either on his own behalf or on behalf of any third party, except on behalf of the Company, directly or indirectly (other than through his ownership of equity interest in the Company), as an individual proprietor, partner, stockholder, officer, employee, director, joint venturer, investor, lender, or in any other capacity whatsoever (other than as the holder of not more than five percent (5%) of the total outstanding stock of a publicly-held company), (i) engage in the manufacture, sale or distribution of chilled fresh dog food; (ii) divert, take away, or attempt to divert or take away, the business or patronage (with respect to products or services of the kind or type developed, produced, marketed, furnished or sold by the Company) of any of the Company’s clients, customers, vendors, business or strategic partners, or accounts, or prospective clients, customers, vendors, business or strategic partners, or accounts, that were contacted, solicited, or served by the Employee while employed by the Company, or (iii) persuade any client, customer, vendor, strategic or business partner, or account of the Company to cease to do business, invest in, participate with, or otherwise work with the Company, or to reduce the amount of business, investment, participation or work that any such client, customer, vendor, or strategic or business .partner has customarily done or actively contemplates doing with the Company.

(b) If any restriction set forth in Section 7 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or geographic area, it shall be interpreted to extend over the maximum period of time, range of activities or geographic areas as to which it maybe enforceable.

(c) The provisions of Section 7 shall survive termination of this Agreement.

8. Protection of Confidential Information. The Executive agrees that all information, whether or not in writing, relating to the business, technical, or financial affairs of the Company and that is generally understood in the chilled fresh dog food industry (and any other related or relevant industry) as being confidential and/or proprietary information, is the exclusive property of the Company. The Executive agrees to hold in a fiduciary capacity for the sole benefit of the Company all secret, confidential or proprietary information, knowledge, data, or trade secret (“Confidential Information”) relating to the Company or any of its affiliates or their respective clients, which Confidential Information shall have been obtained during his employment with the Company. By way of illustration, but not limitation, Confidential Information includes information regarding the Company’s projects, methodologies, business or vendor relationships, relationships with strategic or business partners, and all information and know-how (whether or not patentable, copyrightable or otherwise able to be registered or protected under laws governing intellectual property) owned, possessed, or used by the Company, including, without limitation, any invention, existing or future product, formula, method, manufacturing techniques and procedures, composition, compound, project, development, plan, market research, vendor information, supplier information, customer lists or

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information, apparatus, equipment, trade secret, process, research, reports, clinical data, financial data, technical data, test data, know-how, computer program, software, software documentation, source code, hardware design, technology, marketing or business plan, forecast, unpublished financial statement, budget, license, patent applications, contracts, joint ventures, price, cost and personnel data, any trade names, trademarks or slogans, but shall not include information that (i) is or becomes public knowledge through legal means without fault by the Executive, (ii) is already public knowledge prior to the signing of this Agreement, (iii) was available to the Executive on a non-confidential basis prior to its disclosure by the Company, (iv) was disclosed by the Executive in the performance of his duties hereunder, or (v) must be disclosed pursuant to applicable law or court order.

The Executive agrees that he will not at any time, either during the Term of this Agreement or after its termination, disclose to anyone any Confidential Information, or utilize such Confidential Information for his own benefit, or for the benefit of third parties without written approval by an officer of the Company. Executive further agrees that all memoranda, notes, records, data, schematics, sketches, computer programs, prototypes, or written, photographic, magnetic or other documents or tangible objects compiled by him or made available to him during the Term of his employment concerning the business of the Company and/or its clients, including any copies of such materials, shall be the property of the Company and shall be delivered to the Company on the termination of his employment, or at any other time upon request of the Company.

9. Publicity. Neither party shall issue, without consent of the other party, any press release or make any public announcement with respect to this Agreement or the employment relationship between them. Following the date of this Agreement and regardless of any dispute that may arise in the future, the Executive and the Company jointly and mutually agree that they will not disparage, criticize or make statements which are negative, detrimental or injurious to the other to any individual, company or client, including within the Company.

10. Binding Agreement. This Agreement shall be binding upon and inure to the benefit of the parties hereto, their heirs, personal representatives, successors and assigns. In the event the Company is acquired, is a non surviving party in a merger, or transfers substantially all of its assets, this Agreement shall not be terminated and the transferee or surviving company shall be bound by the provisions of this Agreement. The parties understand that the obligations of the Executive are personal and may not be assigned by him.

11. Entire Agreement. This Agreement contains the entire understanding of the Executive and the Company with respect to employment of the Executive and supersedes any and all prior understandings, written or oral. This Agreement may not be amended, waived, discharged or terminated orally, but only by an instrument in writing, specifically identified as an amendment to this Agreement, and signed by all parties. By entering into this Agreement, the Executive certifies and acknowledges that he has carefully read all of the provisions of this Agreement and that he voluntarily and knowingly enters into said Agreement. Nothing contained herein shall be deemed to limit or modify the rights of Executive under that certain Stock Purchase and Sale Agreement and that certain Stockholders Agreement among the Company and certain of stockholders, both dated as of the date hereof.

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12. Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be deemed severable from the remainder of this Agreement, and the remaining provisions contained in this Agreement shall be construed to preserve to the maximum permissible extent the intent and purposes of this Agreement. Any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

13. Governing Law and Submission to Jurisdiction. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, without giving effect to the principles of conflicts of law thereof.

14. Notices. Any notice provided for in this Agreement shall be provided in writing. Notices shall be effective from the date of service, if served personally on the party to whom notice is to be given, or on the second day after mailing, if mailed by first class mail, postage prepaid. Notices shall be properly addressed to the parties at their respective addresses or to such other address as either party may later specify by notice to the other.

15. ARBITRATION. THE PARTIES AGREE THAT ANY CONTROVERSY, CLAIM OR DISPUTE ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE BREACH THEREOF, EXCEPT AS DISCUSSED HEREIN OR ARISING OUT OF OR RELATING TO THE EMPLOYMENT OF THE EXECUTIVE, OR THE TERMINATION THEREOF, INCLUDING ANY STATUTORY OR COMMON LAW CLAIMS UNDER FEDERAL, STATE, OR LOCAL LAW, INCLUDING ALL LAWS PROHIBITING DISCRIMINATION IN THE WORKPLACE, SHALL BE RESOLVED BY ARBITRATION IN NEW YORK IN ACCORDANCE WITH THE EMPLOYMENT DISPUTE RESOLUTION RULES OF JAMS/ENDISPUTE. THE PARTIES AGREE THAT ANY AWARD RENDERED BY THE ARBITRATOR SHALL BE FINAL AND BINDING, AND THAT JUDGMENT UPON THE AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION THEREOF. THE PARTIES FURTHER ACKNOWLEDGE AND AGREE THAT, DUE TO THE NATURE OF THE CONFIDENTIAL INFORMATION, TRADE SECRETS, AND INTELLECTUAL PROPERTY BELONGING TO THE COMPANY TO WHICH THE EXECUTIVE HAS OR WILL BE GIVEN ACCESS, AND THE LIKELIHOOD OF SIGNIFICANT HARM THAT THE COMPANY WOULD SUFFER IN THE EVENT THAT SUCH INFORMATION WAS DISCLOSED TO THIRD PARTIES, NOTHING IN THIS SECTION SHALL PRECLUDE THE COMPANY FROM GOING TO COURT TO SEEK INJUNCTIVE RELIEF TO PREVENT EXECUTIVE FROM VIOLATING THE OBLIGATIONS ESTABLISHED IN SECTIONS 7 THROUGH 9 OF THIS AGREEMENT.

In the event of a dispute between the parties regarding Executive’s entitlement to any bonus, severance or other compensation, benefits or entitlements under this Agreement, the Company agrees that, upon commencement of any legal proceeding arising out of such dispute, it will

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either (i) place an amount equal to the amount in dispute in an interest-bearing escrow account mutually agreeable to the parties, or (ii) shall deliver to the Executive an irrevocable letter of credit containing terms, including those relating to the accrual of interest, mutually agreeable to the parties. In the event that the Company fails to do so, Executive shall be entitled to seek injunctive relief ordering the Company to deposit the money in escrow during the pendency of the relevant legal proceeding, and the proceeding seeking injunctive relief may be instituted in, and both the Company and Executive consent to jurisdiction within, the State of New York, without giving effect to the principles of conflicts of law thereof.

17. Indemnification.

(a) Corporate Acts. In his capacity as a director, manager, officer, or employee of the Company or serving or having served any other entity as a director, manager, officer, or Executive at the Company’s request, Executive shall be indemnified and held harmless by the Company to the fullest extent allowed by law, the Company’s charter and by-laws, from and against any and all losses, claims, damages, liabilities, expenses (including legal fees and expenses), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative, in which Executive may be involved, or threatened to be involved, as a party or otherwise by reason of Executive’s status, which relate to or arise out of the Company, their assets, business or affairs, if in each of the foregoing cases, (i) Executive acted in good faith and in a manner Executive believed to be in, or not opposed to, the best interests of the Company, and, with respect to any criminal proceeding, had no reasonable cause to believe Executive’s conduct was unlawful, and (ii) Executive’s conduct did not constitute gross negligence or willful or wanton misconduct (and the Company shall also advance expenses as incurred to the fullest extent permitted under applicable law, provided Executive provides an undertaking to repay advances if it is ultimately determined that Executive is not entitled to indemnification). The Company shall advance all expenses incurred by Executive in connection with the investigation, defense, settlement or appeal of any civil or criminal action or proceeding referenced in this Section, including but not necessarily limited to legal counsel, expert witnesses or other litigation-related expenses. Executive shall be entitled to coverage under the Company’s directors and officers liability insurance policy in effect at any time in the future to no lesser extent than any other officers or directors of the Company. After Executive is no longer employed by the Company, the Company shall keep in effect the provisions of this Section, which provision shall not be amended except as required by applicable law or except to make changes permitted by law that would enlarge the right of indemnification of Executive. Notwithstanding anything herein to the contrary, the provisions of this Section shall survive the termination of this Agreement and the termination of the Period of Employment for any reason.

(b) Personal Guarantees. The Company shall indemnify and hold harmless the Executive for any liability incurred by him by reason of his execution of any personal guarantee for the Company’s benefit (including but not limited to personal guarantees in connection with office or equipment leases, commercial loans or promissory notes).

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17. Miscellaneous.

(a) No delay or omission by either party in exercising any right under this Agreement shall operate as a waiver of that or any other right. A waiver or consent given by one party on my one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of any right on any other occasion.

(b) The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.

(c) Any rights of Employee hereunder shall be in addition to any rights Employee may otherwise have under written benefit plans or agreements of the Company to which he is a party or in which he is a participant, including, but not limited to, any Company sponsored written employee benefit plans, stock option plans, grants and agreements.

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be duly executed and delivered under seal, by its authorized officers or individually, on the date first identified above.

PROFESSOR CONNOR’S, INC.:
/s/ Cathal Walsh
By:	Cathal Walsh
Title:	CEO
SCOTT MORRIS:
/s/ Scott Morris

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EX-10.21

Exhibit 10.21

AMENDMENT TO EMPLOYMENT AGREEMENT

THIS AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is dated as of January 6, 2009, by and between PROFESSOR CONNOR’S, INC., a Delaware corporation (the “Company”), and Scott Morris (“Executive”).

WHEREAS, the Company and Executive previously entered into that certain Employment Agreement dated as of October 25, 2006 (the “Employment Agreement”);

WHEREAS, the Company and its stockholders, including Executive, have entered into that certain Stock Purchase and Merger Agreement (the “Purchase Agreement”) with Tyson Foods, Inc. (“Purchaser”); and

WHEREAS, the execution and delivery of this Amendment by the Company and Executive are conditions to the closing of the Purchase Agreement.

NOW, THEREFORE, in consideration of the mutual covenants herein and of the mutual benefits herein provided, the Company and Executive agree as follows:

1. Effectiveness. This Amendment is effective upon the closing of the First Closing (as defined in the Purchase Agreement) and shall remain in full force and effect unless and until a Cancellation Notice or Termination Notice (as those terms are defined in the Purchase Agreement) is given by Purchaser to the Company. In the event a Cancellation Notice or Termination Notice is given by Purchaser, this Amendment shall immediately terminate and the Employment Agreement shall continue in full force and effect without regard to this Amendment.

2. Duties and Functions. Section 3(b) of the Employment Agreement is amended to read in its entirety as follows:

“(b) During the Employment Period, the Executive will devote his full time and efforts to the business of the Company. The Executive may address personal investment or charitable activities for reasonable periods of time each month so long as such activities do not interfere with the Executive’s responsibilities under this Employment Agreement.”

3. Options and Series A Preferred Stock. Section 4(b) of the Employment Agreement is amended to read in its entirety as follows:

“(b) Participation in Stock Option Program; Series A Preferred Stock: The Executive shall be eligible to participate in the Company’s equity incentive programs, as such programs may exist on the date hereof or from time to time hereafter, to the same extent as other, similarly situated employees of the Company; provided, however, Executive acknowledges that all existing equity incentive programs have been fully granted and the Company does not intend to create any other equity incentive

programs, except to the extent necessary to attract new or additional management, as to which Executive will not participate. Executive and the Company agree to amend the existing Stock Option Agreement between them pursuant to the Amendment to Stock Option Agreement attached as Exhibit A hereto. Pursuant to Section 5.1.1 of the Certificate of Incorporation of the Company, all shares of Series A Preferred Stock, par value $0.001 (the “Preferred Stock”) beneficially owned by the Executive (including any shares transferred by Executive during the term hereof) are redeemable by the Company at a redemption price of $0.01 per share at any time after the Executive terminates employment with the Company without Good Reason (other than for permanent disability or death) or is terminated by the Company for Cause. Executive (or any permitted transferee) shall immediately deliver certificates representing all Preferred Stock beneficially owned by Executive (or such transferee) duly endorsed in blank upon written notice by the Company in exchange for the redemption price.

4. Employment Period; Termination. Section 5 of the Employment Agreement is hereby amended in the following respects:

1. Section 5(b) is amended to read in its entirety as follows:

“(b) The Employment Period shall continue until terminated upon the earlier to occur of the following events: (i) the close of business on the first anniversary of the Final Closing Date (as defined in the Purchase Agreement) (the “Initial Term”) or (ii) the death or permanent disability (as defined in Section 5(f)) of the Executive, provided, however, that, on the first anniversary of the Final Closing Date, and on every subsequent annual anniversary, and unless either party has given the other party written notice at least ninety (90) days prior to the such anniversary date, the term of this Agreement and the Employment Period shall be renewed for a term ending one (1) year subsequent to such date (each such one-year term shall be referred to herein as “Renewal Term”), unless sooner terminated as provided herein. For the purposes of this Agreement, the Initial Term and each Renewal Term shall collectively be referred to as the “Employment Period.”

2. Notwithstanding the provisions of paragraph 5(c) or 5(e) of the Employment Agreement, the severance payable to Executive shall be limited to twelve (12) months base salary from the effective date of termination and shall be payable in accordance with the Company’s normal payroll schedule, subject to Executive’s confirmation of Executive’s obligations pursuant to Section 7 of the Employment Agreement. In addition, in the event of a termination pursuant to paragraph 5(e), Executive shall continue to receive fringe/medical benefits for the twelve-month period.

3. Section 5(e) is amended by deleting the following sentence:

“The non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will terminate on the effective date of termination if Executive’s employment with the Company is terminated pursuant to this Section 5(e).”

and is replaced instead with:

“The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment.”

4. The definition of “Good Reason” is hereby amended to read in its entirety as follows:

For purposes of this Agreement, “Good Reason” is defined as any one of the following: (i) the Company’s material breach of any provision of the Agreement; (ii) any material adverse change in the Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities, or any other action by the Company made without the Executive’s permission (other than a change due to Executive’s Permanent Disability or as an accommodation under the Americans With Disabilities Act) which results in: (A) a diminution in any material respect in the Executive’s position, authority, duties, responsibilities or compensation (other than a reduction in benefits that is consistent with reductions made with respect to the benefits of all employees of the Company), which diminution continues in time over at least thirty (30) days, such that it constitutes an effective demotion (provided, however, that no diminution of title, position, duties or responsibilities shall be deemed to occur solely because the Company becomes a subsidiary of another corporation or entity); or (B) a material diversion from the Executive’s performance of the functions of the Executive’s position (including but not necessarily limited to the Executive’s authority to hire, direct, and/or fire employees and the Executive’s authority to oversee the general direction and focus of the Company), excluding for this purpose material adverse changes made with the Executive’s written consent or due to the Executive’s Termination For Cause or termination by the Executive without Good Reason; or (iii) a relocation by the Company of the Executive’s place of employment outside a thirty (30) mile radius of Executive’s current place of employment without the Executive’s written

consent; provided, however, that it shall not constitute Good Reason unless the Executive shall have provided the Company with written notice of its alleged actions constituting Good Reason (which notice shall specify in reasonable detail the particulars of such Good Reason) and Company has not cured any such alleged Good Reason within thirty (30) days of Company’s receipt of such written notice; further provided, that upon the Final Closing (as defined in the Purchase Agreement), none of the following shall constitute “Good Reason”: any additional reporting obligations; approval requirements and procedures (including with respect to hiring and firing of employees) imposed as a result of Purchaser’s customary policies and practices applicable to Purchaser’s subsidiaries and personnel; or the providing of services and consultation to the Purchaser and its subsidiaries which are consistent with Executive’s position and function.

5. Section 7(a) is amended to read in its entirety as follows:

“(a) The Executive agrees that, in consideration of his employment with the Company pursuant to this Agreement, and other good and valuable consideration, the receipt of which is hereby acknowledged, during Executive’s employment with the Company and for twelve (12) months after termination thereof, the Executive will not either on his own behalf or on behalf of any third party, except on behalf of the Company, directly or indirectly (other than through his ownership of equity interest in the Company), as a individual proprietor, partner, stockholder, officer, employee, director, joint venturer, investor, lender, or in any other capacity whatsoever (other than as the holder of not more than one percent (1%) of the total outstanding stock of a publicly-held company), (i) engage in the manufacture, sale or distribution of frozen or refrigerated pet food or frozen or refrigerated pet treats; (ii) divert, take away, or attempt to divert or take away, the business or patronage (with respect to products or services of the kind or type developed, produced, marketed, furnished or sold by the Company) of any of the Company’s clients, customers, vendors, business or strategic partners, or accounts, or prospective clients, customers, vendors, business or strategic partners, or accounts, that were contacted, solicited, or served by the Employee while employed by the Company, (iii) persuade any client, customers, vendor, strategic or business partner, or account of the Company to cease to do business, invest in, participate with, or otherwise work with the Company, or to reduce the amount of business, investment, participation or work that any such client, customer, vendor, or strategic or business partner has customarily done or actively contemplates doing with the Company, or (iv) hire, solicit, assist or in any way encourage any employee or

consultant of the Company or any affiliate of the Company to terminate his or her employment relationship or consultant relationship with the Company or its affiliates.”

6. Indemnification. Executive acknowledges that the obligations of the Company set forth in Section 17(a) of the Employment Agreement to provide coverage under the Company’s directors and officers liability insurance policy is subject to the limitations set forth in Section 7.12 of the Purchase Agreement.

7. Section 409A. A new Section 18 is added as follows:

“18. Section 409A.

(a) If a payment obligation under this Agreement arises on account of the Executive’s separation from service while the Executive is a “specified employee” (as defined under Section 409A of the Internal Revenue Code, and the guidance thereunder (“Section 409A”)) of a public company, any payment of “deferred compensation” (as defined under Treasury Regulation Section 1.409A-1(b)(1), after giving effect to the exemptions in Treasury Regulation Sections 1.409A-1(b)(3) through (b)(12)) that is scheduled to be paid within six (6) months after such separation from service shall be paid within 15 days after the end of the six-month period beginning on the date of such separation from service or, if earlier, within 15 days after the appointment of the personal representative or executor of the Executive’s estate following his death.

(b) “Termination of employment,” “resignation,” or words of similar import, as used in this Agreement means, for purposes of any payments under this Agreement that are payments of deferred compensation subject to Section 409A, the Executive’s “separation from service” as defined in Section 409A. For purposes of Section 409A, the right to a series of installment payments under this Agreement shall be treated as a right to a series of separate payments.

(c) With respect to any reimbursement of expenses of, or any provision of in-kind benefits to, the Executive, as specified under this Agreement, such reimbursement of expenses or provision of in-kind benefits shall be subject to the following conditions: (1) the expenses eligible for reimbursement or the amount of in-kind benefits provided in one taxable year shall not affect the expenses eligible for reimbursement or the amount of in-kind benefits provided in any other taxable year, except for any medical reimbursement arrangement providing for the reimbursement of expenses referred to in Section 105(b) of the

Internal Revenue Code; (2) the reimbursement of an eligible expense shall be made no later than the end of the year after the year in which such expense was incurred; and (3) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit.”

8. No Other Amendment. Except as modified by this Amendment, the parties agree that the Employment Agreement is in full force and effect according to its terms.

9. Third Party Beneficiary. Executive and the Company acknowledge that this Amendment is for the benefit of Purchaser, and neither the Employment Agreement nor this Amendment may be amended without the prior written consent of Purchaser.

10. Counterparts. This Amendment may be executed and delivered in any number of counterparts, each of which so executed and delivered shall be deemed to be an original and all of which shall constitute one and the same instrument. The exchange of executed counterparts of this Amendment or of signature pages by facsimile or other electronic transmission shall constitute effective execution and delivery of this Amendment and may be used in lieu of the original for all purposes.

[Remainder of the page intentionally left blank]

IN WITNESS WHEREOF, THE COMPANY AND EXECUTIVE HAVE EXECUTED THIS AMENDMENT AS OF THE DATE SET FORTH ABOVE.

COMPANY:
PROFESSOR CONNOR’S, INC.
BY:	/s/ Richard A Kassan
Name:	Richard A Kassan
Title:	CEO
EXECUTIVE:
/s/ Scott Morris
Name:		Scott Morris

EX-10.22

Exhibit 10.22

EMPLOYMENT AGREEMENT

THIS AGREEMENT is dated as of October 25, 2006, by and between Professor Connor’s, Inc., a Delaware corporation (the “Company”), and Cathal Walsh (the “Executive”).

In consideration of the mutual covenants herein contained and of the mutual benefits herein provided, the Company and the Executive agree as follows:

1. Representations and Warranties. The Executive represents and warrants to the Company that Executive is not bound by any restrictive covenants and has no prior or other obligations or commitments of any kind that would in any way prevent, restrict, hinder or interfere with Executive’s acceptance of continued employment or the performance of all duties and services hereunder to the fullest extent of the Executive’s ability and knowledge. The Executive agrees to indemnify and hold harmless the Company for any liability the Company may incur as the result of the existence of any such covenants, obligations or commitments.

2. Term of Employment. The Company will continue to employ the Executive and the Executive accepts continued employment by the Company on the terms and conditions herein contained for a period (the “Employment Period”) provided in Section 5.

3. Duties and Functions.

(a) (1) The Executive shall be employed as the Chief Operating Officer of the Company and shall oversee, direct and be responsible for all administrative and operational aspects of the Company’s business. The Executive shall report directly to the Chief Executive Officer (the “CEO”).

(2) The Executive agrees to undertake the duties and responsibilities commensurate with the position of Chief Operating Officer, which may encompass different or additional duties as may, from time to time, be reasonably assigned by the CEO and/or the Board, and the duties and responsibilities undertaken by the Executive maybe reasonably altered or modified from time to time by the Board, so long as that Executive’s responsibilities as Chief Operating Officer are not materially reduced, and his reporting relationship is not materially altered or modified in an adverse way.

(b) During the Employment Period, the Executive will devote his time and efforts to the business of the Company. The Executive may engage in non-competitive business or charitable activities for reasonable periods of time each month so long as such activities do not interfere with the Executive’s responsibilities under this Employment Agreement.

4. Compensation.

(a) Base Salary: As compensation for his services hereunder, during the Executive’s employment as Chief Operating Officer, the Company agrees to pay the Executive a base salary at the rate of Two Hundred Thousand Dollars ($200,000) per annum, payable in accordance with the Company’s normal payroll schedule, or on such other periodic basis as may be mutually agreed upon. The Company may withhold from any amounts payable under this Agreement such federal, state or local taxes as shall be required to be withheld pursuant to any applicable law or regulation. In no event shall Executive’s salary be reduced below his current salary (or, subsequent to any increases, below his then current salary).

Executive’s salary shall be subject to annual review, based on corporate policy and contributions made by Executive to the Company.

(b) Participation in Stock Option Program: The Executive shall be eligible to participate in the Company’s equity incentive programs, as such programs may exist on the date hereof or from time to hereafter, to the same extent as other, similarly situated employees of the Company.

(c) Other Expenses: In addition to the compensation provided for above, the Company agrees to pay or to reimburse the Executive during his employment for all reasonable, ordinary, and necessary, properly vouchered, client-related business or entertainment expenses incurred in the performance of his services hereunder in accordance with Company policy in effect from time to time. The Executive shall submit vouchers and receipts for all expenses for which reimbursement is sought.

(d) Vacation: During each calendar year, the Executive shall be entitled to four (4) weeks of vacation.

(e) Fringe Benefits: In addition to his compensation provided by the foregoing, the Executive shall be entitled to the benefits available generally to Company employees pursuant to Company programs, including, by way of illustration, personal leave, paid holidays, sick leave, profit-sharing, retirement, disability, dental, vision, group sickness, accident or health insurance programs of the Company which may now or, if not terminated, shall hereafter be in effect, or in any other or additional such programs which may be established by the Company, as and to the extent any such programs are or may from time to time be in effect, as determined by the Company and the terms hereof.

5. Employment Period; Termination.

(a) The Executive’s employment under this Agreement shall continue thereafter unabated until terminated by either party pursuant to the terms of this Agreement.

(b) The Employment Period shall continue until terminated upon the earlier to occur of the following events: (i) the close of business on the third anniversary of this Agreement (the initial three (3) year term of this Agreement shall be referred to herein as the “Initial Term”) or (ii) the death or permanent disability (as defined in Section 5 (f)) of the Executive, provided, however, that, on the third anniversary of the date of this Agreement, and on every subsequent annual anniversary, and unless either party has given the other party written notice at least ninety (90) days prior to the such anniversary date, the term of this Agreement and

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the Employment Period shall be renewed for a term ending one (1) year subsequent to such date (each such one-year term shall be referred to herein as a “Renewal Term”), unless sooner terminated as provided herein. For the purposes of this Agreement, the Initial Term and each Renewal Term shall collectively be referred to as the “Employment Period.”

(c) Notwithstanding the provisions of Sections 5(a) and (b) above, the Executive may terminate the employment relationship at any time for any reason by giving the Company written notice at least thirty (30) days prior to the effective date of termination. Unless otherwise provided by this Section, all compensation and benefits paid by the Company to the Executive shall cease upon his last day of employment; provided, however, that if the Executive terminates his employment for “Good Reason” pursuant to the terms and conditions set forth below, the Company will continue to pay the Executive’s base salary and medical benefits for the greater of (i) the remaining term of the Agreement under the then applicable Employment Period, or (ii) a period of twelve (12) months from the effective date of termination, provided, however, that there shall be offset against any liability for compensation during any period more than twelve (12) months from the date of such termination any compensation paid to the Executive in his capacity as an employee, consultant or independent contractor, and Executive’s interest in any stock options or restricted stock for which he has become eligible under the terms of the applicable stock option plan or agreement shall fully vest on the effective date of his termination. Executive shall also be entitled to receive any accrued but unpaid salary and bonuses, and to be reimbursed for any reimbursable expenses that have not been reimbursed prior to such termination. The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

For purposes of this Agreement, “Good Reason” is defined as any one of the following: (i) Company’s material breach of any provision of this Agreement; (ii) any material adverse change in Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities, or any other action by the Company made without Executive’s permission (other than a change due to Executive’s Permanent Disability or as an accommodation under the Americans With Disabilities Act) which results in: (A) a diminution in any material respect in Executive’s position, authority, duties, responsibilities or compensation, which diminution continues in time over at least thirty (30) days, such that it constitutes an effective demotion (provided, however, that no diminution of title, position, duties or responsibilities shall be deemed to occur solely because the Company becomes a subsidiary of another corporation or entity); or (B) a material diversion from Executive’s performance of the functions of Executive’s position (including but not necessarily limited to Executive’s authority to hire, direct, and/or fire employees, Executive’s authority to oversee the general direction and focus of the Company), excluding for this purpose material adverse changes made with Executive’s written consent or due to Executive’s termination For Cause or termination by Executive without Good Reason; or (iii) relocation of the Company’s headquarters to a location which requires him to travel more than thirty (30) additional miles from Executive’s residence than Executive must already travel to arrive at the Company’s headquarters without Executive’s

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written consent; provided, however, that it shall not constitute Good Reason unless Executive shall have provided the Company with written notice of its alleged actions constituting Good Reason (which notice shall specify in reasonable detail the particulars of such Good Reason) and Company has not cured any such alleged Good Reason within 30 days of Company’s receipt of such written notice.

(d) If the Executive’s employment is terminated for “Cause,” the Executive shall not be entitled to receive severance pay. As used in this Agreement, the term “Cause” shall include a termination for (i) fraud (including but not limited to any acts of embezzlement or misappropriation of funds); (ii) serious dereliction of fiduciary obligation; (iii) conviction of a felony, plea of guilty or nolo contendere to a felony charge or any criminal act involving moral turpitude (which, through lapse of time or otherwise, is not subject to appeal); (iv) repeatedly being under the influence of drugs or alcohol (other than prescription medicine or other medically-related drugs to the extent that they are taken in accordance with their directions) during the performance of his duties under this Agreement, or, while under the influence of such drugs or alcohol, engaging in grossly inappropriate conduct during the performance of his duties under this Agreement; or (v) a refusal to substantially perform the Executive’s duties hereunder, except in the event that the Executive becomes permanently disabled as set forth in Section 5(f). Anything herein to the contrary notwithstanding, the Company shall give the Executive written notice prior to terminating this Agreement of the Executive’s employment based upon a serious dereliction of fiduciary obligation or refusal to perform ((ii) or (v) above), setting forth the exact nature of any such alleged serious dereliction of duty or refusal to perform and the conduct required to cure such breach. The Executive shall have thirty (30) days from the giving of such notice within which to cure. The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

(e) Upon sixty (60) days written notice, the Company shall retain the right to terminate the Executive without Cause. If the Executive’s employment is terminated by the Company without Cause, the Executive shall continue to receive his base salary and fringe/medical benefits as provided for in Section 4 (collectively, the “Fringe Benefits”) for the greater of (i) the remaining term of the Agreement under the then applicable Employment Period, or (ii) a period of twelve (12) months from the effective date of termination, provided, however, that there shall be offset against any liability for compensation during any period more than twelve (12) months from the date of such termination any compensation paid to the Executive in his capacity as an employee, consultant or independent contractor. Furthermore, Executive’s interest in any stock options or restricted stock for which he has become eligible under the terms of the applicable stock option or restricted stock plan or agreement or for which he was scheduled to become eligible at any time during the then applicable Employment Period (collectively, the “Options”) shall fully vest on the effective date of his termination without Cause. The non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will terminate on the effective date of termination if Executive’s

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employment with the Company is terminated pursuant to this Section 5(e). The confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

(f) In the event the Executive becomes permanently disabled during employment with the Company, the Company may terminate this Agreement by giving thirty (30) days notice to the Executive of its intent to terminate, and unless the Executive resumes performance of the duties set forth in Section 3 within five (5) days of the date of the notice and continues performance for the remainder of the notice period, this Agreement shall terminate at the end of the thirty (30) day period. If the Executive is terminated pursuant to this Section 5(f), he shall be entitled to receive severance pay in an amount equal to twelve (12) months of salary, less all applicable withholding and deductions, and Executive shall be entitled to receive all stock options and the Fringe Benefits as if Executive’s employment had continued through the twelve (12) month period following termination. This severance pay shall be payable in accordance with the Company’s normal payroll schedule, or on such other periodic basis as may be mutually agreed upon, from the effective date of his termination, as if Executive’s employment had continued during the twelve (12) month severance period. “Permanently disabled” for the purposes of this Agreement means the inability, due to physical or mental ill health, to perform the Executive’s duties for one hundred twenty (120) days during any one employment year, irrespective of whether such days are consecutive. In the event of any dispute under this Section, the Executive shall submit to a physical examination by a licensed physician mutually satisfactory to the Company and the Employee, the cost of such examination to be paid by the Company, and the determination of such physician shall be determinative. The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment under this section, and the confidentiality and rights to inventions obligations established in Sections 8 and 9 of this Agreement will survive the termination of this Agreement pursuant to this section.

(g) This Agreement will terminate immediately upon the Executive’s death and the Company shall not have any further liability or obligation to the Employee, his executors, heirs, assigns or any other person claiming under or through his estate, except that Executive’s estate shall receive any accrued but unpaid salary or bonuses, and Executive’s interest in any stock options or restricted stock for which he had become eligible under the terms of the applicable stock option or restricted stock plan or agreement or for which he was scheduled to become eligible at any time during the then applicable Employment Period under the terms of any such stock option or restricted stock plan or agreement (collectively, the “Options”) shall fully vest on the effective date of his termination under this Section 5(g).

6. Company Property. All correspondence, records, documents, software, promotional materials, and other Company property, including all copies, which come into the Executive’s possession by, through or in the course of his employment, regardless of the source and whether created by the Executive, are the sole and exclusive property of the Company, and immediately upon the termination of the Executive’s employment, or any time at the Company’s request, the Executive shall return to the Company all such property of the Company.

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7. Non-Competition.

(a) The Executive agrees that, in consideration of his employment with the Company pursuant to this Agreement, and other good and valuable consideration, the receipt of which is hereby acknowledged, during Employee’s employment with the Company and for twelve (12) months after termination thereof, the Employee will not either on his own behalf or on behalf of any third party, except on behalf of the Company, directly or indirectly (other than through his ownership of equity interest in the Company), as an individual proprietor, partner, stockholder, officer, employee, director, joint venturer, investor, lender, or in any other capacity whatsoever (other than as the holder of not more than five percent (5%) of the total outstanding stock of a publicly-held company), (i) engage in the manufacture, sale or distribution of chilled fresh dog food; (ii) divert, take away, or attempt to divert or take away, the business or patronage (with respect to products or services of the kind or type developed, produced, marketed, furnished or sold by the Company) of any of the Company’s clients, customers, vendors, business or strategic partners, or accounts, or prospective clients, customers, vendors, business or strategic partners, or accounts, that were contacted, solicited, or served by the Employee while employed by the Company, or (iii) persuade any client, customer, vendor, strategic or business partner, or account of the Company to cease to do business, invest in, participate with, or otherwise work with the Company, or to reduce the amount of business, investment, participation or work that any such client, customer, vendor, or strategic or business partner has customarily done or actively contemplates doing with the Company.

(b) If any restriction set forth in Section 7 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or geographic area, it shall be interpreted to extend over the maximum period of time, range of activities or geographic areas as to which it may be enforceable.

(c) The provisions of Section 7 shall survive termination of this Agreement.

8. Protection of Confidential Information. The Executive agrees that all information, whether or not in writing, relating to the business, technical, or financial affairs of the Company and that is generally understood in the chilled fresh dog food industry (and any other related or relevant industry) as being confidential and/or proprietary information, is the exclusive property of the Company. The Executive agrees to hold in a fiduciary capacity for the sole benefit of the Company all secret, confidential or proprietary information, knowledge, data, or trade secret (“Confidential Information”) relating to the Company or any of its affiliates or their respective clients, which Confidential Information shall have been obtained during his employment with the Company. By way of illustration, but not limitation, Confidential Information includes information regarding the Company’s projects, methodologies, business or vendor relationships, relationships with strategic or business partners, and all information and know-how (whether or not patentable, copyrightable or otherwise able to be registered or protected under laws governing intellectual property) owned, possessed, or used by the Company, including, without limitation, any invention, existing or future product, formula, method, manufacturing techniques and procedures, composition, compound, project,

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development, plan, market research, vendor information, supplier information, customer lists or information, apparatus, equipment, trade secret, process, research, reports, clinical data, financial data, technical data, test data, know-how, computer program, software, software documentation, source .code, hardware design, technology, marketing or business plan, forecast, unpublished financial statement, budget, license, patent applications, contracts, joint ventures, price, cost and personnel data, any trade names, trademarks or slogans, but shall not include information that (i) is or becomes public knowledge through legal means without fault by the Executive, (ii) is already public knowledge prior to the signing of this Agreement, (iii) was available to the Executive on a non-confidential basis prior to its disclosure by the Company, (iv) was disclosed by the Executive in the performance of his duties hereunder, or (v) must be disclosed pursuant to applicable law or court order.

The Executive agrees that he will not at any time, either during the Term of this Agreement or after its termination, disclose to anyone any Confidential Information, or utilize such Confidential Information for his own benefit, or for the benefit of third parties without written approval by an officer of the Company. Executive further agrees that all memoranda, notes, records, data, schematics, sketches, computer programs, prototypes, or written, photographic, magnetic or other documents or tangible objects compiled by him or made available to him during the Term of his employment concerning the business of the Company and/or its clients, including any copies of such materials, shall be the property of the Company and shall be delivered to the Company on the termination of his employment, or at any other time upon request of the Company.

9. Publicity. Neither party shall issue, without consent of the other party, any press release or make any public announcement with respect to this Agreement or the employment relationship between them. Following the date of this Agreement and regardless of any dispute that may arise in the future, the Executive and the Company jointly and mutually agree that they will not disparage, criticize or make statements which are negative, detrimental or injurious to the other to any individual, company or client, including within the Company.

10. Binding Agreement. This Agreement shall be binding upon and inure to the benefit of the parties hereto, their heirs, personal representatives, successors and assigns. In the event the Company is acquired, is a non surviving party in a merger, or transfers substantially all of its assets, this Agreement shall not be terminated and the transferee or surviving company shall be bound by the provisions of this Agreement. The parties understand that the obligations of the Executive are personal and may not be assigned by him.

11. Entire Agreement. This Agreement contains the entire understanding of the Executive and the Company with respect to employment of the Executive and supersedes any and all prior understandings, written or oral. This Agreement may not be amended, waived, discharged or terminated orally, but only by an instrument in writing, specifically identified as an amendment to this Agreement, and signed by all parties. By entering into this Agreement, the Executive certifies and acknowledges that he has carefully read all of the provisions of this Agreement and that he voluntarily and knowingly enters into said Agreement. Nothing contained herein shall be deemed to limit or modify the rights of Executive under that certain Stock Purchase and Sale Agreement and that certain Stockholders Agreement among the Company and certain of stockholders, both dated as of the date hereof.

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12. Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be deemed severable from the remainder of this Agreement, and the remaining provisions contained in this Agreement shall be construed to preserve to the maximum permissible extent the intent and purposes of this Agreement. Any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

13. Governing Law and Submission to Jurisdiction. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, without giving effect to the principles of conflicts of law thereof.

14. Notices. Any notice provided for in this Agreement shall be provided in writing. Notices shall be effective from the date of service, if served personally on the party to whom notice is to be given, or on the second day after mailing, if mailed by first class mail, postage prepaid. Notices shall be properly addressed to the parties at their respective addresses or to such other address as either party may later specify by notice to the other.

15. ARBITRATION. THE PARTIES AGREE THAT ANY CONTROVERSY, CLAIM OR DISPUTE ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE BREACH THEREOF, EXCEPT AS DISCUSSED HEREIN OR ARISING OUT OF OR RELATING TO THE EMPLOYMENT OF THE EXECUTIVE, OR THE TERMINATION THEREOF, INCLUDING ANY STATUTORY OR COMMON LAW CLAIMS UNDER FEDERAL, STATE, OR LOCAL LAW, INCLUDING ALL LAWS PROHIBITING DISCRIMINATION IN THE WORKPLACE, SHALL BE RESOLVED BY ARBITRATION IN NEW YORK IN ACCORDANCE WITH THE EMPLOYMENT DISPUTE RESOLUTION RULES OF JAMS/ENDISPUTE. THE PARTIES AGREE THAT ANY AWARD RENDERED BY THE ARBITRATOR SHALL BE FINAL AND BINDING, AND THAT JUDGMENT UPON THE AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION THEREOF. THE PARTIES FURTHER ACKNOWLEDGE AND AGREE THAT, DUE TO THE NATURE OF THE CONFIDENTIAL INFORMATION, TRADE SECRETS, AND INTELLECTUAL PROPERTY BELONGING TO THE COMPANY TO WHICH THE EXECUTIVE HAS OR WILL BE GIVEN ACCESS, AND THE LIKELIHOOD OF SIGNIFICANT HARM THAT THE COMPANY WOULD SUFFER IN THE EVENT THAT SUCH INFORMATION WAS DISCLOSED TO THIRD PARTIES, NOTHING IN THIS SECTION SHALL PRECLUDE THE COMPANY FROM GOING TO COURT TO SEEK INJUNCTIVE RELIEF TO PREVENT EXECUTIVE FROM VIOLATING THE OBLIGATIONS ESTABLISHED IN SECTIONS 7 THROUGH 9 OF THIS AGREEMENT.

In the event of a dispute between the parties regarding Executive’s entitlement to any bonus, severance or other compensation, benefits or entitlements under this Agreement, the Company agrees that, upon commencement of any legal proceeding arising out of such dispute, it will

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either (i) place an amount equal to the amount in dispute in an interest-bearing escrow account mutually agreeable to the parties, or (ii) shall deliver to the Executive an irrevocable letter of credit containing terms, including those relating to the accrual of interest, mutually agreeable to the parties. In the event that the Company fails to do so, Executive shall be entitled to seek injunctive relief ordering the Company to deposit the money in escrow during the pendency of the relevant legal proceeding, and the proceeding seeking injunctive relief may be instituted in, and both the Company and Executive consent to jurisdiction within, the State of New York, without giving effect to the principles of conflicts of law thereof.

17. Indemnification.

(a) Corporate Acts. In his capacity as a director, manager, officer, or employee of the Company or serving or having served any other entity as a director, manager, officer, or Executive at the Company’s request, Executive shall be indemnified and held harmless by the Company to the fullest extent allowed by law, the Company’s charter and by-laws, from and against any and all losses, claims, damages, liabilities, expenses (including legal fees and expenses), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative, in which Executive may be involved, or threatened to be involved, as a party or otherwise by reason of Executive’s status, which relate to or arise out of the Company, their assets, business or affairs, if in each of the foregoing cases, (i) Executive acted in good faith and in a manner Executive believed to be in, or not opposed to, the best interests of the Company, and, with respect to any criminal proceeding, had no reasonable cause to believe Executive’s conduct was unlawful, and (ii) Executive’s conduct did not constitute gross negligence or willful or wanton misconduct (and the Company shall also advance expenses as incurred to the fullest extent permitted under applicable law, provided Executive provides an undertaking to repay advances if it is ultimately determined that Executive is not entitled to indemnification). The Company shall advance all expenses incurred by Executive in connection with the investigation, defense, settlement or appeal of any civil or criminal action or proceeding referenced in this Section, including but not necessarily limited to legal counsel, expert witnesses or other litigation-related expenses. Executive shall be entitled to coverage under the Company’s directors and officers liability insurance policy in effect at any time in the future to no lesser extent than any other officers or directors of the Company. After Executive is no longer employed by the Company, the Company shall keep in effect the provisions of this Section, which provision shall not be amended except as required by applicable law or except to make changes permitted by law that would enlarge the right of indemnification of Executive. Notwithstanding anything herein to the contrary, the provisions of this Section shall survive the termination of this Agreement and the termination of the Period of Employment for any reason.

(b) Personal Guarantees. The Company shall indemnify and hold harmless the Executive for any liability incurred by him by reason of his execution of any personal guarantee for the Company’s benefit (including but not limited to personal guarantees in connection with office or equipment leases, commercial loans or promissory notes).

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17. Miscellaneous.

(a) No delay or omission by either party in exercising any right under this Agreement shall operate as a waiver of that or any other right. A waiver or consent given by one party on any one occasion shall be effective only in that instance and shall not be construed as a bar or waiver of any right on any other occasion.

(b) The captions of the sections of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any section of this Agreement.

(c) Any rights of Employee hereunder shall be in addition to any rights Employee may otherwise have under written benefit plans or agreements of the Company to which he is a party or in which he is a participant, including, but not limited to, any Company sponsored written employee benefit plans, stock option plans, grants and agreements.

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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be duly executed and delivered under seal, by its authorized officers or individually, on the date first identified above.

PROFESSOR CONNOR’S, INC.:
/s/ Scott Morris
By:	Scott Morris
Title:	Secretary
CATHAL WALSH:
/s/ Cathal Walsh

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EX-10.23

Exhibit 10.23

AMENDMENT TO EMPLOYMENT AGREEMENT

THIS AMENDMENT TO EMPLOYMENT AGREEMENT (this “Amendment”) is dated as of January 6, 2009, by and between PROFESSOR CONNOR’S, INC., a Delaware corporation (the “Company”), and Cathal Walsh (“Executive”).

WHEREAS, the Company and Executive previously entered into that certain Employment Agreement dated as of October 25, 2006 (the “Employment Agreement”);

WHEREAS, the Company and its stockholders, including Executive, have entered into that certain Stock Purchase and Merger Agreement (the “Purchase Agreement”) with Tyson Foods, Inc. (“Purchaser”); and

WHEREAS, the execution and delivery of this Amendment by the Company and Executive are conditions to the closing of the Purchase Agreement.

NOW, THEREFORE, in consideration of the mutual covenants herein and of the mutual benefits herein provided, the Company and Executive agree as follows:

1. Effectiveness. This Amendment is effective upon the closing of the First Closing (as defined in the Purchase Agreement) and shall remain in full force and effect unless and until a Cancellation Notice or Termination Notice (as those terms are defined in the Purchase Agreement) is given by Purchaser to the Company. In the event a Cancellation Notice or Termination Notice is given by Purchaser, this Amendment shall immediately terminate and the Employment Agreement shall continue in full force and effect without regard to this Amendment.

2. Duties and Functions. Section 3(b) of the Employment Agreement is amended to read in its entirety as follows:

“(b) During the Employment Period, the Executive will devote his full time and efforts to the business of the Company. The Executive may address personal investment or charitable activities for reasonable periods of time each month so long as such activities do not interfere with the Executive’s responsibilities under this Employment Agreement.”

3. Options and Series A Preferred Stock. Section 4(b) of the Employment Agreement is amended to read in its entirety as follows:

“(b) Participation in Stock Option Program; Series A Preferred Stock: The Executive shall be eligible to participate in the Company’s equity incentive programs, as such programs may exist on the date hereof or from time to time hereafter, to the same extent as other, similarly situated employees of the Company; provided, however, Executive acknowledges that all existing equity incentive programs have been fully granted and the Company does not intend to create any other equity incentive

programs, except to the extent necessary to attract new or additional management, as to which Executive will not participate. Executive and the Company agree to amend the existing Stock Option Agreement between them pursuant to the Amendment to Stock Option Agreement attached as Exhibit A hereto. Pursuant to Section 5.1.1 of the Certificate of Incorporation of the Company, all shares of Series A Preferred Stock, par value $0.001 (the “Preferred Stock”) beneficially owned by the Executive (including any shares transferred by Executive during the term hereof) are redeemable by the Company at a redemption price of $0.01 per share at any time after the Executive terminates employment with the Company without Good Reason (other than for permanent disability or death) or is terminated by the Company for Cause. Executive (or any permitted transferee) shall immediately deliver certificates representing all Preferred Stock beneficially owned by Executive (or such transferee) duly endorsed in blank upon written notice by the Company in exchange for the redemption price.

4. Employment Period; Termination. Section 5 of the Employment Agreement is hereby amended in the following respects:

1. Section 5(b) is amended to read in its entirety as follows:

“(b) The Employment Period shall continue until terminated upon the earlier to occur of the following events: (i) the close of business on the first anniversary of the Final Closing Date (as defined in the Purchase Agreement) (the “Initial Term”) or (ii) the death or permanent disability (as defined in Section 5(f)) of the Executive, provided, however, that, on the first anniversary of the Final Closing Date, and on every subsequent annual anniversary, and unless either party has given the other party written notice at least ninety (90) days prior to the such anniversary date, the term of this Agreement and the Employment Period shall be renewed for a term ending one (1) year subsequent to such date (each such one-year term shall be referred to herein as “Renewal Term”), unless sooner terminated as provided herein. For the purposes of this Agreement, the Initial Term and each Renewal Term shall collectively be referred to as the “Employment Period.”

2. Notwithstanding the provisions of paragraph 5(c) or 5(e) of the Employment Agreement, the severance payable to Executive shall be limited to twelve (12) months base salary from the effective date of termination and shall be payable in accordance with the Company’s normal payroll schedule, subject to Executive’s confirmation of Executive’s obligations pursuant to Section 7 of the Employment Agreement. In addition, in the event of a termination pursuant to paragraph 5(e), Executive shall continue to receive fringe/medical benefits for the twelve-month period.

3. Section 5(e) is amended by deleting the following sentence:

“The non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will terminate on the effective date of termination if Executive’s employment with the Company is terminated pursuant to this Section 5(e).”

and is replaced instead with:

“The Executive acknowledges and agrees that the non-competition and non-solicitation restrictions set forth in Section 7 of this Employment Agreement will remain in full force and effect for the twelve (12) month period after the termination of his employment.”

4. The definition of “Good Reason” is hereby amended to read in its entirety as follows:

For purposes of this Agreement, “Good Reason” is defined as any one of the following: (i) the Company’s material breach of any provision of the Agreement; (ii) any material adverse change in the Executive’s position (including status, offices, titles and reporting requirements), authority, duties or responsibilities, or any other action by the Company made without the Executive’s permission (other than a change due to Executive’s Permanent Disability or as an accommodation under the Americans With Disabilities Act) which results in: (A) a diminution in any material respect in the Executive’s position, authority, duties, responsibilities or compensation (other than a reduction in benefits that is consistent with reductions made with respect to the benefits of all employees of the Company), which diminution continues in time over at least thirty (30) days, such that it constitutes an effective demotion (provided, however, that no diminution of title, position, duties or responsibilities shall be deemed to occur solely because the Company becomes a subsidiary of another corporation or entity); or (B) a material diversion from the Executive’s performance of the functions of the Executive’s position (including but not necessarily limited to the Executive’s authority to hire, direct, and/or fire employees and the Executive’s authority to oversee the general direction and focus of the Company), excluding for this purpose material adverse changes made with the Executive’s written consent or due to the Executive’s Termination For Cause or termination by the Executive without Good Reason; or (iii) a relocation by the Company of the Executive’s place of employment outside a thirty (30) mile radius of Executive’s current place of employment without the Executive’s written

consent; provided, however, that it shall not constitute Good Reason unless the Executive shall have provided the Company with written notice of its alleged actions constituting Good Reason (which notice shall specify in reasonable detail the particulars of such Good Reason) and Company has not cured any such alleged Good Reason within thirty (30) days of Company’s receipt of such written notice; further provided, that upon the Final Closing (as defined in the Purchase Agreement), none of the following shall constitute “Good Reason”: any additional reporting obligations; approval requirements and procedures (including with respect to hiring and firing of employees) imposed as a result of Purchaser’s customary policies and practices applicable to Purchaser’s subsidiaries and personnel; or the providing of services and consultation to the Purchaser and its subsidiaries which are consistent with Executive’s position and function.

5. Section 7(a) is amended to read in its entirety as follows:

“(a) The Executive agrees that, in consideration of his employment with the Company pursuant to this Agreement, and other good and valuable consideration, the receipt of which is hereby acknowledged, during Executive’s employment with the Company and for twelve (12) months after termination thereof, the Executive will not either on his own behalf or on behalf of any third party, except on behalf of the Company, directly or indirectly (other than through his ownership of equity interest in the Company), as a individual proprietor, partner, stockholder, officer, employee, director, joint venturer, investor, lender, or in any other capacity whatsoever (other than as the holder of not more than one percent (1%) of the total outstanding stock of a publicly-held company), (i) engage in the manufacture, sale or distribution of frozen or refrigerated pet food or frozen or refrigerated pet treats; (ii) divert, take away, or attempt to divert or take away, the business or patronage (with respect to products or services of the kind or type developed, produced, marketed, furnished or sold by the Company) of any of the Company’s clients, customers, vendors, business or strategic partners, or accounts, or prospective clients, customers, vendors, business or strategic partners, or accounts, that were contacted, solicited, or served by the Employee while employed by the Company, (iii) persuade any client, customers, vendor, strategic or business partner, or account of the Company to cease to do business, invest in, participate with, or otherwise work with the Company, or to reduce the amount of business, investment, participation or work that any such client, customer, vendor, or strategic or business partner has customarily done or actively contemplates doing with the Company, or (iv) hire, solicit, assist or in any way encourage any employee or consultant of the Company or any affiliate of the Company to terminate his or her employment relationship or consultant relationship with the Company or its affiliates.”

6. Indemnification. Executive acknowledges that the obligations of the Company set forth in Section 17(a) of the Employment Agreement to provide coverage under the Company’s directors and officers liability insurance policy is subject to the limitations set forth in Section 7.12 of the Purchase Agreement.

7. Section 409A. A new Section 18 is added as follows:

“18. Section 409A.

(a) If a payment obligation under this Agreement arises on account of the Executive’s separation from service while the Executive is a “specified employee” (as defined under Section 409A of the Internal Revenue Code, and the guidance thereunder (“Section 409A”)) of a public company, any payment of “deferred compensation” (as defined under Treasury Regulation Section 1.409A-1(b)(1), after giving effect to the exemptions in Treasury Regulation Sections 1.409A-1(b)(3) through (b)(12)) that is scheduled to be paid within six (6) months after such separation from service shall be paid within 15 days after the end of the six-month period beginning on the date of such separation from service or, if earlier, within 15 days after the appointment of the personal representative or executor of the Executive’s estate following his death.

(b) “Termination of employment,” “resignation” or words of similar import, as used in this Agreement means, for purposes of any payments under this Agreement that are payments of deferred compensation subject to Section 409A, the Executive’s “separation from service” as defined in Section 409A. For purposes of Section 409A, the right to a series of installment payments under this Agreement shall be treated as a right to a series of separate payments.

(c) With respect to any reimbursement of expenses of, or any provision of in-kind benefits to, the Executive, as specified under this Agreement, such reimbursement of expenses or provision of in-kind benefits shall be subject to the following conditions: (1) the expenses eligible for reimbursement or the amount of in-kind benefits provided in one taxable year shall not affect the expenses eligible for reimbursement or the amount of in-kind benefits provided in any other taxable year, except for any medical reimbursement arrangement providing for the reimbursement of expenses referred to in Section 105(b) of the

Internal Revenue Code; (2) the reimbursement of an eligible expense shall be made no later than the end of the year after the year in which such expense was incurred; and (3) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit.”

8. No Other Amendment. Except as modified by this Amendment, the parties agree that the Employment Agreement is in full force and effect according to its terms.

9. Third Party Beneficiary. Executive and the Company acknowledge that this Amendment is for the benefit of Purchaser, and neither the Employment Agreement nor this Amendment may be amended without the prior written consent of Purchaser.

10. Counterparts. This Amendment may be executed and delivered in any number of counterparts, each of which so executed and delivered shall be deemed to be an original and all of which shall constitute one and the same instrument. The exchange of executed counterparts of this Amendment or of signature pages by facsimile or other electronic transmission shall constitute effective execution and delivery of this Amendment and may be used in lieu of the original for all purposes.

[Remainder of the page intentionally left blank]

IN WITNESS WHEREOF, THE COMPANY AND EXECUTIVE HAVE EXECUTED THIS AMENDMENT AS OF THE DATE SET FORTH ABOVE.

COMPANY: PROFESSOR CONNOR’S, INC.
BY:	/s/ Richard A Kassan
Name:	Richard A Kassan
Title:	CEO
EXECUTIVE: /s/ Cathal Walsh
Name:	Cathal Walsh

EX-10.27

Exhibit 10.27

AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT

This Amended and Restated Fee and Reimbursement Agreement (“Agreement”) is entered into as of April 15, 2013 by and among Professor Connor’s, Inc., a Delaware corporation (the “Company”), (i) MidOcean Partners III, L.P. (“MidOcean III”), MidOcean Partners III-A, L.P. (“MidOcean III-A”), MidOcean Partners III-D, L.P (together with MidOcean III and MidOcean III-A, “MidOcean”), (ii) each of the members of Freshpet Investors, LLC, a Delaware limited liability company (“FPI”) that are identified as such on Exhibit A (the “FPI Guarantors”), (iii) each of the other Persons listed on Exhibit B hereto (the “Other Guarantors” and together with the FPI Guarantors and MidOcean, each a “Guarantor” and collectively the “Guarantors”), and solely for purposes of Section 4(c), Freshpet Investors, LLC, a Delaware limited liability company (“FPI”).

R E C I T A L S

A. WHEREAS, MidOcean and the FPI Guarantors have previously entered into a Fee and Reimbursement Agreement dated as of June 8, 2012 (the “Original Fee Agreement”), pursuant to which, among other things, the parties hereto allocated financial liability among the Guarantors for obligations arising under that certain Credit Agreement dated as of June 8, 2012 pursuant to which OneWest Bank, FSB (“OneWest”) and several other lenders made available to the Company a revolving credit facility in the maximum principal amount of $40 million (the “Original Credit Agreement”).

B. WHEREAS, in connection with the Company entering into the Original Credit Agreement, OneWest requested that MidOcean enter into an Equity Contribution Agreement to guarantee a portion of the Company’s payment obligations to OneWest under the Original Credit Agreement and each of the FPI Guarantors and each of the Other Guarantors agreed to enter into a Shareholder Guarantee to guarantee a portion of the Company’s payment obligations to OneWest under the Original Credit Agreement (collectively, the “Original Guarantees”).

C. WHEREAS, substantially concurrently herewith the Original Credit Agreement is being amended and restated to provide that the lenders will increase the revolving loan facility to a maximum amount of $60 million (as amended, restated, supplemented, refinanced, replaced or otherwise modified and in effect from time to time, the “Credit Agreement”).

D. WHEREAS, to induce OneWest to enter into the Credit Agreement, MidOcean, certain of the FPI Guarantors and each of the Other Guarantors has agreed to enter into (i) in the case of MidOcean, a First Amendment to the Equity Contribution Agreement and (ii) in the cash of the FPI Guarantors and the Other Guarantors, an Amendment to Guarantee and Reaffirmation to reconfirm the Original Guarantee of such Person and increase the amount of such Person’s guarantee to reflect the increase in the Company’s maximum borrowing from $45 million to $60 million (the Original Guarantees, as amended, the “Guarantees”) , each in an amount not to exceed the amount set forth under the heading “Amended Guarantee Amount” on Annex 1 hereto.

E. WHEREAS, the Guarantors now desire to amend Annex 1 to the Fee and Reimbursement Agreement to reallocate the liability among each of the Guarantors under the Credit Agreement.

F. WHEREAS, the Company has determined that this Agreement, the Guarantees, the Credit Agreement and the transaction contemplated hereby and thereby are advisable and in its best interests and the best interests of its stockholders.

G. WHEREAS, each of the Guarantors, on the one hand, and the Company, on the other, have a preexisting personal or business relationship.

H. WHEREAS, each of the Guarantors and the Company, by reason of its own business and financial experience or that of its advisors could reasonably be assumed to have the capacity to protect its own interests in connection with the transactions contemplated by this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the following covenants and agreements the parties hereby agree as follows:

1. Issuance of Guarantee. The Company hereby requests that each of the Guarantors issue the Guarantee in favor of OneWest. The Guarantors will guarantee the Company’s payment obligations under the Credit Agreement in favor of OneWest pursuant to the terms and conditions set forth in the Guarantee.

2. Fee. The Company will pay each Guarantor, subject to the conditions below, a contingent fee equal to the sum of 10% per annum of the amount of the Total Obligations of such Guarantor in the form of newly issued shares of Series C Preferred Stock, par value $0.001 per share, of the Company at a price of $5.25 per share (the “Guarantee Fee Preferred Stock”). The Guarantee Fee Preferred Stock shall accrue only from and after the date that such Guarantor enters into the Guarantee, and if at any time any Guarantor’s obligation under the Credit Agreement and/or Guarantee is terminated in full or in part, the Guarantee Fee Preferred Stock shall continue to accrue only with respect the amount, if any, of such Guarantor’s remaining commitment under the Credit Agreement and/or Guarantee. The issuance of the Guarantee Fee Preferred Stock shall be contingent such that it will become due and payable only upon a Change of Control and only if all principal and interest under the Credit Agreement has been repaid prior to consummation thereof or is repaid in connection therewith. The Guarantee Fee Preferred Stock is being delivered to the Guarantors in recognition of the additional financial risk associated with the Guarantors’ investment in the Company as a result of the Credit Agreement and not as compensation or a payment for any services rendered or otherwise in connection with the pursuit by Guarantor of a trade or business. Notwithstanding the foregoing, in the event that any Guarantor has failed to satisfy its obligations to OneWest pursuant to the terms of such Guarantor’s Guarantee, the Guarantee Fee Preferred Stock otherwise payable to such Guarantor in accordance with this Section 2 shall be forfeited. For purposes of this Agreement, “Change of Control” means, with respect to the Company, (i) any sale, merger, consolidation, share exchange, business combination, equity issuance or other transaction or series of related transactions, specifically excluding public offerings, which result in the stockholders immediately prior to the transaction(s) owning collectively less than 50% of

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the voting control immediately following the transaction(s); or (ii) any sale, lease, exchange, transfer or other disposition of substantially all of the assets, taken as a whole, in a single transaction or series of transactions, excluding sales in the ordinary course of business, sale/leaseback and corporate restructuring transactions. “Total Obligations” with respect to any Guarantor shall mean the amount set forth opposite such Guarantor’s name on Annex I attached hereto, as such Schedule may be modified following the date hereof to reflect the termination or reduction of the obligations of such Guarantor hereunder, which shall equal (x) the Initial Guarantee Amount from and after the date that such Guarantor entered into the Guarantee through the date ending immediately prior to the date hereof and (y) the Amended Guarantee Amount beginning on the date hereof; provided, that the Total Obligations with respect to each Guarantor as of any date of determination in which there has been a reduction or termination of the obligation of such Guarantor hereunder shall be the weighted average of the amounts set forth opposite such Guarantor’s name based on the number of days elapsed in such quarter (or portion thereof) prior to and after the amendment of Annex I to reflect such reduction or termination of the obligations of such Guarantor hereunder.

3. Notices of Demand from OneWest. Any of the undersigned who receives a demand for payment from OneWest under any Guarantee shall promptly provide notice of such demand to each of the other parties hereto as provided for in Section 11 hereto. Notwithstanding the party or parties to whom OneWest makes a demand, the Company will have the primary obligation to make payment to OneWest for any amounts demanded by OneWest under the Credit Agreement or guaranty thereof. The parties will use commercially reasonable efforts to communicate and cooperate on the making of any payments to OneWest under any Guarantee and any party hereto making a payment shall promptly provide the other parties hereto with evidence of such payment. In the event the Company does not make the payment to OneWest under the Credit Agreement, each Guarantors agrees to incur the several obligation to make, and agrees to actually make, payments directly to OneWest pursuant to the terms of (but in no event in excess of the amount set forth in) their respective Guarantee and in accordance with such Guarantor’s pro-rata percentage under the heading “Amended Pro-Rata Percentage” set forth on Annex 1 (“Pro-Rata Percentage”).

4. Reimbursement and Interest. (a) Payments. In addition to the Fees, the Company hereby agrees to issue to any Guarantor funding amounts to OneWest pursuant to the terms of any Guarantee (after taking into consideration any amounts funded to such Guarantor pursuant to Section 4(b) below) a number of shares of preferred stock of the Company that rank pari passu in all respects with the Company’s Series C Preferred Stock, par value $0.001 per share (the “Funded Guarantee Preferred Stock”), equal to the amount funded to OneWest pursuant to such Guarantee divided by the lesser of $3.00 per share and seventy-five percent (75%) of the fair market value thereof at the time of issuance (the “Funded Guarantee Preferred Stock Issue Price”). The Company shall prepare all documents and instruments necessary to authorize the Funded Guarantee Preferred Stock and issue the Funded Guarantee Preferred Stock to a Guarantor within three (3) days following payment to OneWest by a Guarantor (the “Payment Due Date”). The Company further covenants and agrees that the Company will at all times have authorized and reserved a sufficient number of unissued shares of blank check

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preferred stock to file a Certificate of Designations pursuant to the Delaware General Corporate Law to issue the Funded Guarantee Preferred Stock.¹ All amounts under this Section 4(a) shall be paid without set-off, claim or counterclaim in funds immediately available to Guarantor. The obligations of the Company hereunder to reimburse the Guarantors shall be absolute, irrevocable and unconditional and shall be performed strictly in accordance with the terms hereof, irrespective of any lack of validity or enforceability of the Credit Agreement or any related agreement or any other event or circumstance.

(b) Reimbursement of Guarantor by other Guarantors. In the event that a Guarantor has not been reimbursed by the Company for amounts owing under Section 4(a) above by the Payment Due Date and if, notwithstanding Section 3 above, such Guarantor has paid to OneWest an amount in excess of such Guarantor’s Pro-Rata Percentage, in furtherance of Guarantor’s right of contribution, such Guarantor (“Initial Guarantor”) may make it demand on any Guarantor who has not paid its Pro-Rata Percentage (a “Contributing Guarantor”), which demand shall state the total amount demanded by OneWest, the amount paid by the Initial Guarantor, the amount required to be paid by each Contributing Guarantor and wire transfer instructions for such payment to the Initial Guarantor. Within three (3) days of receipt of such notice, each Contributing Guarantor shall make a payment to the Initial Guarantor in immediately available funds in the amount required to be paid by such Contributing Guarantor to the Initial Guarantor in respect to such demand, less any amounts previously paid by such Contributing Guarantor to OneWest pursuant to such demand.

(c) Share Forfeiture. In the event that any Guarantor shall fail to make payment when due of such Guarantor’s Pro-Rata Percentage pursuant to the terms of Section 3 or Section 4(b) (a “Defaulting Guarantor” and the unpaid portion of such Guarantee, the “Default Amount”), the Company shall notify each of the Guarantors (other than the Defaulting Guarantor) (such other Guarantors being so notified, the “Contributing Guarantors”) of the aggregate Default Amount. Each Contributing Guarantor may (but shall not be obligated to) fund the Default Amount to OneWest in satisfaction of the Defaulting Guarantor’s obligations in respect of the Default Amount; provided, that if more than one Guarantor elects to fund the Default Amount, such electing Guarantors shall fund the Default Amount pro rata based on their respective Pro-Rata Percentage or in such other manner as they may agree (provided that the FPI Guarantors shall have the right to fund the full Pro-Rata Percentage of the FPI Guarantors before the Pro-Rata Percentage of the FPI Guarantors is offered to any other Guarantor). If and to the extent that OneWest agrees to accept funding from a Contributing Guarantor in satisfaction of the Default Amount, then in connection with the funding of all (but not less than all) or any portion of any Default Amount by one or more Contributing Guarantors, the Defaulting Guarantor shall immediately surrender a number of shares of the Company’s common stock, par value $0.001 per share (or in the case of a Guarantor that owns preferred stock of the Company, the most senior class of convertible preferred stock of the Company held by such Guarantor), equal to the Default Amount actually funded by the Contributing Guarantors divided by Funded

¹  Jonathan: Please confirm current authorized amount is sufficient in light of increased guarantee amount. If not, we will need to amend the charter to increased the authorized number of shares.

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Guarantee Preferred Stock Issue Price (which in the case of preferred shall be calculated on an as-if converted to common basis), and such shares shall be transferred on the books and records of the Company to the Contributing Guarantors pro rata based on the respective amounts funded. In the event that less than all of the Default Amount is funded by the Contributing Guarantors (or none of the Default Amount is funded), the Defaulting Guarantor shall surrender to the Company (which shall become authorized, but unissued shares) a number of shares of the Company’s common stock, par value $0.001 per share (or in the case of a Guarantor that owns preferred stock of the Company, the most senior class of convertible preferred stock of the Company held by such Guarantor), equal to the Default Amount (excluding any such amount funded by the Contributing Guarantors) divided by Funded Guarantee Preferred Stock Issue Price (which in the case of preferred shall be calculated on an as-if converted to common basis), and upon such surrender. In furtherance of the foregoing, each Guarantor provides the Company with an irrevocable right to take such actions necessary to effect the agreement set forth in the preceding two sentences. With respect to any Defaulting Guarantor who is a Freshpet Guarantor, the obligations set forth in this Section 4(c) paragraph shall be exercisable directly against FPI.

(d) Interest. All sums payable to a Guarantor under Section 4(b) shall bear interest, from the date the payment is made under the Guarantee until such sums are paid in full at a rate of 10% per annum, or if lower, the maximum rate permitted by law (computed for the actual number of days elapsed, based on a 365/366 day year). Interest accruing pursuant to this Section 4(c) shall be due and payable on demand and on the date the respective sum is paid. It is not the intention of the Guarantors to violate any applicable usury or interest rate laws. None of the Guarantors agrees to, or intends to contract for, charge, collect, take, reserve or receive (collectively, “charge or collect”) any amount in the nature of interest or in the nature of a fee, penalty or other charge which would in any way or event cause any stockholder to charge or collect more than the maximum such Guarantor would be permitted to charge or collect by any applicable federal or state law. Any such excess interest or unauthorized fee shall, notwithstanding anything stated to the contrary in this Agreement, be applied first to reduce the amount owed, if any, and then any excess amounts will be refunded.

5. [Reserved].

6. Subrogation. Upon making any payment under Section 4 of this Agreement, each Guarantor making payment shall be subrogated to the rights of OneWest against the Company with respect to the Credit Agreement.

7. Additional Fees. The Company hereby agrees to pay each Guarantor immediately upon demand for all reasonable charges and expenses paid or incurred by it in connection with the preservation and enforcement of its rights hereunder and collection of amounts due to it hereunder, including without limitation, the reasonable fees and disbursements of its legal counsel. The prevailing Guarantor in any action to enforce Section 4(b) will be entitled to collect the reasonable fees and disbursements of its legal counsel.

8. Taxes. All payments by the Company under this Agreement will be made free and clear of and without deduction for any present or future taxes.

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9. Entire Agreement. This Agreement, together with the Guarantee and the Credit Agreement, contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior arrangements and understandings (whether written or oral) with respect thereto (including, without limitation, the Original Fee Agreement).

10. Reinstatement. Notwithstanding anything to the contrary herein, this Agreement shall continue to be effective or be reinstated, as the case may be, if at any time any amount received by any Guarantor pursuant to this Agreement is rescinded or otherwise must be restored or returned by such Guarantor upon or in connection with the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Company or otherwise, all as though such payment had not been made.

11. [Reserved].

12. Counterparts. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement, and shall become effective when one or more counterparts have been signed by a party and delivered to the other parties. Copies of executed counterparts transmitted by telecopy, telefax or other electronic transmission service shall be considered original executed counterparts for purposes of this Section 12, provided that receipt of copies of such counterparts is confirmed.

13. Notices. All notices and other communications hereunder shall be in writing and shall be deemed effectively given upon the earlier of actual receipt or: (a) personal delivery to the party to be notified, (b) when sent, if sent by electronic mail or facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next business day delivery, with written verification of receipt given by facsimile, certified or registered mail, overnight delivery service such as Federal Express, or personal delivery against receipt to the party to whom it is given. All communications shall be sent, (a) if to a Guarantor, at such Guarantor’s address (and/or facsimile number) as set forth on the signature page, or at such other address as such Guarantor shall have furnished to the Company in writing, or (b) if to the Company, at 400 Plaza Drive, Secaucus, New Jersey 07094, and/or via facsimile at (201) 866-2018 and addressed to the attention of Richard Kassar, or at such other address and/or facsimile number as the Company shall have furnished to the Guarantors.

14. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO SUCH STATE’S CHOICE OF LAW PROVISIONS.

15. Submission to Jurisdiction. (a) Each of the parties hereto hereby irrevocably acknowledges and consents that any legal action or proceeding brought with respect to any of the obligations arising under or relating to this Agreement may be brought in the courts of the State of New York, County of New York, or if it has or can acquire jurisdiction in the United States District Court for the Southern District of New York, as the party bringing such

-6-

action or proceeding may elect, and each of the parties hereto hereby irrevocably submits to and accepts with regard to any such action or proceeding, for itself and in respect of its property, generally and unconditionally, the non-exclusive jurisdiction of the aforesaid courts. Each party hereby further irrevocably waives any claim that any such courts lack jurisdiction over such party, and agrees not to plead or claim, in any legal action or proceeding with respect to this Agreement or the transactions contemplated hereby brought in any of the aforesaid courts, that any such court lacks jurisdiction over such party. Each party irrevocably consents to the service of process in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, to such party, at its address for notices set forth in Section 11, such service to become effective ten (10) days after such mailing. Each party hereby irrevocably waives any objection to such service of process and further irrevocably waives and agrees not to plead or claim in any action or proceeding commenced hereunder or under any other documents contemplated hereby that service of process was in any way invalid or ineffective. Subject to Section 13(b), the foregoing shall not limit the rights of any party to serve process in any other manner permitted by law. The foregoing consents to jurisdiction shall not constitute general consents to service of process in the State of New York for any purpose except as provided above and shall not be deemed to confer rights on any person other than the respective parties to this Agreement.

(b) Each of the parties hereto hereby waives any right it may have under the laws of any jurisdiction to commence by publication any legal action or proceeding with respect to this Agreement. To the fullest extent permitted by applicable law, each of the parties hereto hereby irrevocably waives the objection which it may now or hereafter have to the laying of the venue of any suit, action or proceeding arising out of or relating to this Agreement in any of the courts referred to in Section 13(a) and hereby further irrevocably waives and agrees not to plead or claim that any such court is not a convenient forum for any such suit, action or proceeding.

(c) The parties hereto agree that the remedy at law for any breach of this Agreement may be inadequate and that should any dispute arise concerning any matter hereunder, this Agreement shall be enforceable in a court of equity by an injunction or a decree of specific performance. Such remedies shall, however, be cumulative and non-exclusive, and shall be in addition to any other remedies which the parties hereto may have.

16. Assignment. No party may assign its rights or obligations hereunder without the express written consent of the other parties hereto; provided, however, that an assignment of this Agreement by any Guarantor to an affiliate or successor entity that assumes the obligations of such Guarantor under the Guarantee to which such Guarantor is a party shall not be deemed an assignment under this Section 16. Any attempted assignment will be void. Subject to the foregoing, this Agreement will benefit and bind the successors and assigns of the parties. No party will be a third party beneficiary of this Agreement.

17. Waivers. The Company waives any rights with respect to, or defenses to, its obligations to the Guarantors hereunder that may be available by reason of any election of remedies by any Guarantor (including any such election that in any manner impairs, destroys or extinguishes the Company’s subrogation rights, rights to proceed against any other person or entity for reimbursement, or any other rights to proceed against any other person or entity or security).

-7-

18. No Agency. The parties hereto are independent contractors. This Agreement will not be construed as creating an agency, partnership or any other form of legal association (other than as expressly set forth herein) between the parties.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

-8-

IN WITNESS WHEREOF, the parties hereto have entered into this Amended and Restated Fee and Reimbursement Agreement as of the date first written above.

PROFESSOR CONNORS, INC.
By:	/s/ Richard Kassar
Name:	Richard Kassar
Title:	President and Chief Financial Officer

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MIDOCEAN PARTNERS III, L.P.
By:	MidOcean Associates, for and on behalf of its Segregated Portfolio, MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director
MIDOCEAN PARTNERS III-A, L.P.
By:	MidOcean Associates, for and on behalf of its Segregated Portfolio, MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director
MIDOCEAN PARTNERS III-D, L.P.
By:	MidOcean Associates, for and on behalf of its Segregated Portfolio, MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director

Address:

320 Park Avenue, 16th Floor

New York, NY 10022

Attn: J. David Basto

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

RICHARD AND SUZANNE KAYNE LIVING TRUST U/T/D 1/14/99
Richard and Suzanne Kayne Living Trust u/t/d 1/14/99
By:	/s/ Richard A. Kayne
	Richard A. Kayne, Trustee
By:	/s/ Suzanne L. Kayne
	Suzanne L. Kayne, Trustee
Address:
c/o Kayne Anderson Capital Advisors, LP
1800 Ave. of The Stars, 3rd Floor
Los Angeles, CA 90067

FOR PURPOSES OF SECTION 5:

RICHARD A. KAYNE

/s/ Richard A. Kayne

Richard A. Kayne

Address:

c/o Kayne Anderson Capital Advisors, LP

1800 Ave. of The Stars, 3^rd Floor

Los Angeles, CA 90067

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

LEVINE FAMILY INVESTMENT, LP
Levine Family Investment, LP
By:	/s/ David O. Levine
Name:	David O. Levine
Title:	General Partner
Address:
Levine Family Investment, LP
c/o David O. Levine
10347 Tennessee Avenue
Los Angeles, CA 90064

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

THE LIEBERTHAL TRUST DTD 3/23/99
The Lieberthal Trust dtd 3/23/99
By:	/s/ Gary B. Lieberthal
	Gary B. Lieberthal, Trustee
Address:
991 Bel Air Rd.
Los Angeles, CA 90077

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

PATRICIA NEUWIRTH DTD 2/5/91
Patricia Neuwirth dtd 2/5/91
By:	/s/ Patricia Neuwirth
	Patricia Neuwirth, Trustee
Address:
474 Cuesta Way
Los Angeles, CA 90077

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MOHN FAMILY TRUST
Mohn Family Trust
By:	/s/ Jarl Mohn
	Jarl Mohn, Trustee
Address:
The Mohn Family Trust
100 Wilshire Blvd., Ste. 1830
Santa Monica, CA 90401

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

PETER NEUWIRTH TRUST DTD 12/9/91
Peter Neuwirth Trust dtd 12/9/91
By:	/s/ Peter H. Neuwirth
	Peter H. Neuwirth, Trustee
Address:
474 Cuesta Way
Los Angeles, CA 90077

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

NORRIS TRUST DTD 6/18/02
Norris Trust dtd 6/18/02
By:	/s/ Charles A. Norris
	Charles A. Norris, Trustee
By:	/s/ Margaret T. Norris
	Margaret T. Norris, Trustee
Address:
481 Denslow Avenue
Los Angeles, CA 90049

FOR PURPOSES OF SECTION 5:

CHARLES NORRIS

/s/ Charles Norris

Charles Norris

Address:

481 Denslow Avenue

Los Angeles, CA 90049

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

NORRIS TRUST DTD 6/18/02
By:	/s/ Charles A. Norris
	Charles A. Norris, Trustee
By:	/s/ Margaret T. Norris
	Margaret T. Norris, Trustee
Address:
481 Denslow Avenue Los Angeles, CA 90049

FOR PURPOSES OF SECTION 4:

FRESHPET INVESTORS, LLC

By:	/s/ Charles A. Norris
Name:	Charles A. Norris
Title:
Address:
481 Denslow Avenue
Los Angeles, CA 90049

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

SCOTT RACINE

/s/ Scott Racine

Scott Racine

Address:

4332 Empress Avenue

Encino, CA 91436

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

RUDNICK LIVING TRUST DTD 7/22/91
Rudnick Living Trust dtd 7/22/91
By:	/s/ Allan M. Rudnick
	Allan M. Rudnick, Trustee
By:	/s/ Paula Rudnick
	Paula Rudnick, Trustee
Address:

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

LAWRENCE S. COBEN

/s/ Lawrence S. Coben

Lawrence S. Coben

Address:

40 West 22^nd St #11, NY, NY 10010

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

DOUGLAS A. & LORI A. SCHUR FAMILY TRUST DTD 5/1/97
Douglas A. & Lori A. Schur Family Trust dtd 5/1/97
By:	/s/ Douglas A. Schur
	Douglas A. Schur, Trustee
By:	/s/ Lori A. Schur
	Lori A. Schur, Trustee
Address:
26717 W. Mont Calabasas Dr.
Calabasas, CA 91302

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

JAMES R. WILCOX

/s/ James R. Wilcox

James R. Wilcox

Address:

1297 Sherborne Lane

Powell, OH 43065

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MARILYNN S. MOSCRIP

/s/ Marilynn S. Moscrip

Marilynn S. Moscrip

Address:

11 29^th Avenue, Unit 1

Venice, CA 90291

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

DAVID L. MAHONEY AND WINNIFRED C. ELLIS 1998 TRUST DTD 6/25/98
David L. Mahoney and Winnifred C. Ellis 1998 Trust dtd 6/25/98
By:	/s/ David L. Mahoney
Name:	David L. Mahoney
Title:	Trustee
Address:
121 Jordan Avenue
San Francisco, CA 94118

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

JEFFREY P. HUGHES

/s/ Jeffrey P. Hughes

Jeffrey P. Hughes

Address:

1040 Fifth Avenue

NewYork, NY 10028

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

LYNN J. HORN

/s/ Lynn J. Horn

Address:

59 Wooleys Lane

Great Neck, NY 11023

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

TRUST FBO DAVID STERN
Trust fbo David Stern
By:	/s/ Jonathan Stern
	Jonathan Stern, Trustee
Address:
38 Taylor Ave
Harrison, NY 10528

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

JAMES STERN

/s/ James Stern

James Stern

Address:

38 Taylor Avenue

Harrison, NY 10528

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

TRUST U/W/O LENORE O. STERN
Trust u/w/o Lenore O. Stern
By:	/s/ James A. Stern
	James A. Stern, Trustee
Address:
38 Taylor Avenue
Harrison, NY 10528

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

TRUST FBO PETER STERN
Trust fbo Peter Stern
By:	/s/ Jonathan Stern
	Jonathan Stern, Trustee
Address:
38 Taylor Avenue
Harrison, NY 10528

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

LEVINE-ZACHARIUS LIVING TRUST DTD 11/17/1989
Levine-Zacharius Living Trust dtd 11/17/1989
By:	/s/ David O. Levine
	David O. Levine, Trustee
Address:
10347 Tennessee Avenue
Los Angeles, CA 90064

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

SASQUA FIELDS PARTNERS, LLC
Sasqua Fields Partners, LLC
By:	/s/ David Kercher
Name:	David Kercher
Title:	Managing Director
Address:
236 Main St., P.O. Box 621
Southport, CT 06890-0621

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

HOWARD & MARCIE ZELIKOW LIVING TRUST DTD 5/30/07
Howard & Marcie Zelikow Living Trust dtd 5/30/07
By:	/s/ Howard M. Zelikow
	Howard M. Zelikow, Trustee
Name:	/s/ Marcie P. Zelikow
	Marcie P. Zelikow
Address:

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MICHAEL TARGOFF

/s/ Michael Targoff

Michael Targoff

Address:

600 Third Ave., 36^th Floor

New York, NY 10016

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

DAVID J. SHLADOVSKY

/s/ David J. Shladovsky

David J. Shladovsky

Address:

788 Brooktree Road

Pacific Palisades, CA 90272

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MARILYNE ARMSTRONG 2011 GRANTOR RETAINED ANNUITY TRUST DTD 6/2/11
Marilyne Armstrong 2011 Grantor Retained Annuity Trust dtd 6/2/11
By:	/s/ Marilyne Armstrong
	Marilyne Armstrong, Trustee
Address:
4035 Natasha Drive
Lafayette, CA 94549

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

JOSEPH E. PARZICK

/s/ Joseph E. Parzick

Joseph E. Parzick

Address:

437 Madison Avenue, Ste 33A

New York, NY 10022

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

WILLIAM DAVID WALTERS

/s/ William David Walters

William David Walters

Address:

410 Route O

Everton, MO 65646

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

Annex 1

Guarantor	Initial Guarantee Amount		Initial Pro-Rata Percentage			Additional Obligation		Amended Guarantee Amount		Amended Pro-Rata Percentage
MidOcean Partners III, L.P.	$	12,988,500		32.47	%		6,493,099.70		19,481,599.70		32.47
MidOcean Partners III-A, L.P.	$	6,904,800		17.26	%		3,452,394.60		10,357,194.60		17.26
MidOcean Partners III-D, L.P	$	1,106,700		2.77	%		554,505.70		1,661,205.70		2.77
Mid Ocean Sub-Total	$	21,000,000		52.5	%				31,500,000		52.5	%
Dick Kassar	$	400,000		1.00	%		200,000		600,000		1.00
Richard Thompson	$	600,000		1.50	%		—		600,000		1.00
Management Sub-Total	$	1,000,000		2.50	%				1,500,000		2.00	%
Richard and Suzanne Kayne Living Trust u/t/d 1/14/99	$	5,032,286		12.58			2,516,139		7,548,425		12.58
Norris Trust dtd 6/18/02	$	2,677,730		6.69			1,338,865		4,016,595		6.69
Michael Targoff & TGI Holdings, LLC	$	1,373,795		3.43			686,898		2,060,693		3.43
Armstrong rust dtd 9/14/00	$	1,200,000		3.00			900,000		2,100,000		3.50
David J. Shladovsky	$	1,000,000		2.50			500,000		1,500,000		2.50
Mohn Family Trust	$	892,029		2.23			446,015		1,338,044		2.23
James Stern, Trust fbo David Stern, Trust u/w/o Lenore O. Stern, Trust fbo Peter Stern	$	887,779		2.22			443,890		1,331,669		2.22
Peter Neuwirth Trust dtd 12/9/91	$	662,056		1.66			331,028		993,084		1.66
Douglas Hampson	$	552,780		1.38			276,390		829,170		1.38
James R. Wilcox	$	547,300		1.37			273,650		820,950		1.37
Patricia Neuwirth dtd 2/5/91	$	492,250		1.23			246,125		738,375		1.23
David L. Mahoney and Winnifred C. Ellis 1998 Trust dtd 6/25/98	$	419,410		1.05			209,705		629,115		1.05
Jeffrey P. Hughes	$	355,188		0.89			177,594		532,782		0.89
The Lieberthal Trust dtd 3/23/99	$	329,608		0.82			164,804		494,412		0.82

-40-

Guarantor	Initial Guarantee Amount		Initial Pro-Rata Percentage			Additional Obligation		Amended Guarantee Amount		Amended Pro-Rata Percentage
Howard & Marcie Zelikow Living Trust dtd 5/30/07	$	305,081		0.76			152,541		457,622		0.76
Rudnick Living Trust dtd 7/22/91	$	250,000		0.63			125,000		375,000		0.63
William A. Goldstein	$	150,374		0.38			75,187		225,561		0.38
Lawrence S. Coben	$	122,910		0.31			61,455		184,365		0.31
Levine-Zacharius Living Trust dtd 11/17/1989	$	122,454		0.31			61,227		183,681		0.31
Douglas A. & Lori A. Schur Family Trust dtd 5/1/97	$	112,427		0.28			56,214		168,641		0.28
Sasqua Fields Partners, LLC	$	100,000		0.25			—		100,000		0.17
Silvers Living Trust dtd 2/11/04	$	75,000		0.19			87,500		162,500		0.27
Levine Family Investment, LP	$	66,758		0.17			33,379		100,137		0.17
Marilyn S. Moscrip	$	60,261		0.15			30,131		90,392		0.15
Scott Racine	$	39,935		0.10			19,968		59,903		0.10
Joseph E. Parzick	$	140,030		0.35			70,015		210,045		0.35
William David Walters	$	23,247		0.06			11,624		34,871		0.06
Lynn Horn	$	9,312		0.02			4,656		13,968		0.02
Freshpet Investors Sub-total	$	18,000,000		45	%		9,000,000	$	27,000,000		45.5	%
Total All Guarantees	$	40,000,000		100	%			$	60,000,000		100	%

.

-41-

Exhibit A

Freshpet Investors

-42-

Exhibit B

Other Guarantors

Richard Thompson

Richard Kassar

-43-

EX-10.28

Exhibit 10.28

AMENDMENT NO. 1 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT

This Amendment No. 1 to Amended and Restated Fee and Reimbursement Agreement (“Amendment”) is entered into as of October 9, 2013 with an effective date as of September 30, 2013 by and among Professor Connor’s, Inc., a Delaware corporation (the “Company”) and each of the other parties hereto. Capitalized terms used in this Amendment without separate definition shall have the respective meanings assigned to them in the Amended Fee Agreement (as defined below).

R E C I T A L S

A. WHEREAS, on April 15, 2013 the Original Credit Agreement was amended and restated to provide that the lenders increased the revolving loan facility to a maximum amount of $60 million (as amended, restated, supplemented, refinanced, replaced or otherwise modified and in effect from time to time, the “Credit Agreement”).

B. WHEREAS, to induce OneWest to enter into the Credit Agreement, MidOcean, certain of the FPI Guarantors and each of the Other Guarantors entered into (i) in the case of MidOcean, a First Amendment to the Equity Contribution Agreement and (ii) in the case of the FPI Guarantors and the Other Guarantors, an Amendment to Guarantee and Reaffirmation to reconfirm the Original Guarantee of such Person and increase the amount of such Person’s guarantee to reflect the increase in the Company’s maximum borrowing from $45 million to $60 million (the Original Guarantees, as amended, the “Guarantees”), each in an amount not to exceed the amount set forth under the heading “Amended Guarantee Amount” on Annex 1 hereto.

C. WHEREAS, in connection with entering into the Guarantors, the Guarantors and the Company entered into an Amended and Restated Fee and Reimbursement Agreement dated as of April 15, 2013 (the “Amended Fee Agreement”);

D. WHEREAS, in order for the Company to draw the maximum amount permitted under the Credit Agreement, Richard Kassar, Charles Norris and MidOcean are being requested to increase the amount of their Guarantees as a result of a decrease in the Guarantee by Richard Thompson.

E. WHEREAS, the parties hereto now desire to amend Annex 1 to the Amended Fee Agreement to reflect the reallocated liability among each of such Guarantors under the Credit Agreement; it being understood and agreed that the rights and obligations of any Guarantor not a party to this Amendment shall not be modified by this Amendment.

NOW, THEREFORE, in consideration of the foregoing and the following covenants and agreements the parties hereby agree as follows:

1. Fee. The parties hereto agree that Total Obligations will be calculated as follows: (x) the Initial Guarantee Amount from and after the date that such Guarantor entered into the Guarantee through the date ending April 14, 2013 and (y) the Amended Guarantee Amount beginning on April 15, 2013, as adjusted effective September 30, 2013 to give effect to

the Amendment; provided, that the Total Obligations with respect to each Guarantor as of any date of determination in which there has been a reduction or termination of the obligation of such Guarantor hereunder shall be the weighted average of the amounts set forth opposite such Guarantor’s name based on the number of days elapsed in such quarter (or portion thereof) prior to and after the amendment of Annex I to reflect such reduction or termination of the obligations of such Guarantor hereunder.

2. Amendment to Annex 1. Annex 1 to the Amended Fee Agreement hereby is amended by modifying the Guarantee Amount for the parties identified on the Amendment to Annex I; it being agreed that the Guarantee Amount of any other Guarantor shall be unaffected by such amendment.

3. Effect of Amendment. The parties hereto agree that except as otherwise set forth herein, all terms of the Amended Fee Agreement shall remain in full force and effect. In the event of any inconsistency or conflict between the Amended Fee Agreement and this Amendment, the terms, conditions and provisions of this Amendment shall govern and control.

4. Entire Agreement. This Amendment and the Amended Fee Agreement, including the Exhibits, Schedules and other documents referred to therein which form a part thereof, contain the entire understanding of the parties hereto with respect to the subject matter contained herein and therein. From and after the execution of a counterpart hereof by the parties hereto, any reference to the Amended Fee Agreement shall be deemed to be a reference to the Amended Fee Agreement as amended hereby.

5. Governing Law. The interpretation and construction of this Amendment and all matters relating hereto, shall be governed by the laws of the State of New York applicable to contracts made and to be performed entirely within the State of New York, without giving effect to any conflict of law provisions thereof.

6. Counterparts. This Amendment may be executed in two or more counterparts, each of which shall constitute an original, and all of which taken together shall constitute one instrument. Any signature page delivered by a facsimile machine shall be binding to the same extent as an original signature page.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

-2-

IN WITNESS WHEREOF, the parties hereto have entered into this Amendment No. 1 to Amended and Restated Fee and Reimbursement Agreement as of the date first written above.

PROFESSOR CONNORS, INC.
By:	/s/ Richard Kassar
Name: Richard Kassar
Title:   President and Chief Financial Officer

[SIGNATURE PAGE TO AMENDMENT NO. 1 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MIDOCEAN PARTNERS III, L.P.
By:	MidOcean Associates,
	for and on behalf of its Segregated Portfolio,
	MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director
MIDOCEAN PARTNERS III-A, L.P.
By:	MidOcean Associates,
	for and on behalf of its Segregated Portfolio,
	MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director
MIDOCEAN PARTNERS III-D, L.P.
By:	MidOcean Associates,
	for and on behalf of its Segregated Portfolio,
	MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director
Address:
320 Park Avenue, 16th Floor
New York, NY 10022
Attn: Jonathan Marlow

[SIGNATURE PAGE TO AMENDMENT NO. 1 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

THE NORRIS TRUST, DATED JUNE 18, 2002
By:	/s/ Charles A. Norris
	Charles A. Norris and Margaret T. Norris, as Trustees
Address:
481 Denslow Avenue
Los Angeles, CA 90049

CHARLES A. NORRIS

/s/ Charles A. Norris

Charles A. Norris

Address:

481 Denslow Avenue

Los Angeles, CA 90049

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

RICHARD C. THOMPSON

/s/ Richard C. Thompson

Richard C. Thompson

Address:

1820 Augusta Drive

Center Valley, PA 18034

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

RICHARD KASSAR

/s/ Richard Kassar

Richard Kassar

Address:

200 East End Avenue, Apt. 4F

New York, NY 10128

[SIGNATURE PAGE TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

Amendment to Annex 1

Guarantor	Initial Guarantee Amount		Initial Pro-Rata Percentage1			Additional Obligation		Amended Guarantee Amount		Amended Pro-Rata Percentage2			Further Amended Guarantee Amount		Further Amended Pro-Rata Percentage3
MidOcean Partners III, L.P.	$	12,988,500		32.47	%		6,493,099.70		19,481,599.70		32.47		$	19,543,446.05		32.57	%
MidOcean Partners III-A, L.P.	$	6,904,800		17.26	%		3,452,394.60		10,357,194.60		17.26		$	10,390,074.58		17.32	%
MidOcean Partners III-D, L.P	$	1,106,700		2.77	%		554,505.70		1,661,205.70		2.77		$	1,666,479.37		2.78	%
Mid Ocean Sub-Total	$	21,000,000		52.5	%				31,500,000		52.5	%	$	31,600,000		52.67	%
Dick Kassar	$	400,000		1.00	%		200,000		600,000		1.00		$	700,000		1.17	%
Richard Thompson	$	600,000		1.50	%		—		600,000		1.00		$	300,000		0.50	%
Management Sub-Total	$	1,000,000		2.50	%				1,500,000		2.00	%	$	1,000,000		1.67	%
Norris Trust dtd 6/18/02	$	2,677,730		6.69			1,338,865		4,016,595		6.69		$	4,116,595		6.86	%
Freshpet Investors Sub-total	$	18,000,000		45	%		9,000,000	$	27,000,000		45.5	%	$	27,400,000		45.66	%
Total All Guarantees	$	40,000,000		100	%			$	60,000,000		100	%	$	60,000,000		100.00	%

1 Effective from June 8, 2012 through April 14, 2013

2 Effective from April 15, 2013 through September 30, 2013

3 Effective from September 30, 2013

-8-

EX-10.29

Exhibit 10.29

AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT

This Amendment No. 2 to Amended and Restated Fee and Reimbursement Agreement (“Amendment”) is entered into as of April 7, 2014 by Freshpet, Inc., a Delaware corporation (formerly known as Professor Connor’s, Inc.) (the “Company”) and each of the other parties hereto. Capitalized terms used in this Amendment without separate definition shall have the respective meanings assigned to them in the Amended Fee Agreement (as defined below).

R E C I T A L S

A. WHEREAS, on April 15, 2013 the Original Credit Agreement was amended and restated to provide that the lenders increased the revolving loan facility to a maximum amount of $60 million (as amended, restated, supplemented, refinanced, replaced or otherwise modified and in effect from time to time, the “Credit Agreement”).

B. WHEREAS, to induce OneWest to enter into the Credit Agreement, MidOcean, certain of the FPI Guarantors and each of the Other Guarantors entered into (i) in the case of MidOcean, a First Amendment to the Equity Contribution Agreement and (ii) in the case of the FPI Guarantors and the Other Guarantors, an Amendment to Guarantee and Reaffirmation to reconfirm the Original Guarantee of such Person and increase the amount of such Person’s guarantee to reflect the increase in the Company’s maximum borrowing from $45 million to $60 million (the Original Guarantees, as amended, the “Guarantees”), each in an amount not to exceed the amount set forth under the heading “Amended Guarantee Amount” on Annex 1 hereto.

C. WHEREAS, in connection with entering into the Guarantors, the Guarantors and the Company entered into an Amended and Restated Fee and Reimbursement Agreement dated as of April 15, 2013 (the “Amended Fee Agreement”);

D. WHEREAS, the Company now desire to enter into the Fourth Amendment to the Credit Agreement (the “Fourth Amended Credit Agreement”) to increase the revolving loan facility to the maximum principal amount of $70 million;

E. WHEREAS, the parties hereto now desire to amend further Annex 1 to the Amended Fee Agreement to reflect the liability among each of such Guarantors under the Credit Agreement; it being understood and agreed that the rights and obligations of any Guarantor not a party to this Amendment shall not be modified by this Amendment.

NOW, THEREFORE, in consideration of the foregoing and the following covenants and agreements the parties hereby agree as follows:

1. Fee. The parties hereto agree that Total Obligations will be calculated as follows: (x) the Initial Guarantee Amount from and after the date that such Guarantor entered into the Guarantee through the date ending April 14, 2013 and (y) the Amended Guarantee Amount beginning on April 15, 2013, as adjusted effective September 30, 2013 to give effect to the Second Amended Guarantee Amount, through the date ending the day prior to the effective date of the Fourth Amended Credit Amendment and (z) the Third Amended Guarantee Amount

beginning as of the effective date of the Fourth Amended Credit Agreement; provided, that the Total Obligations with respect to each Guarantor as of any date of determination in which there has been a reduction or termination of the obligation of such Guarantor hereunder shall be the weighted average of the amounts set forth opposite such Guarantor’s name based on the number of days elapsed in such quarter (or portion thereof) prior to and after the amendment of Annex I to reflect such reduction or termination of the obligations of such Guarantor hereunder.

2. Amendment to Annex 1. Annex 1 to the Amended Fee Agreement hereby is amended by modifying the Guarantee Amount for the parties identified on the Amendment to Annex I; it being agreed that the Guarantee Amount of any other Guarantor shall be unaffected by such amendment.

3. Effect of Amendment. The parties hereto agree that except as otherwise set forth herein, all terms of the Amended Fee Agreement shall remain in full force and effect. In the event of any inconsistency or conflict between the Amended Fee Agreement and this Amendment, the terms, conditions and provisions of this Amendment shall govern and control.

4. Entire Agreement. This Amendment and the Amended Fee Agreement, including the Exhibits, Schedules and other documents referred to therein which form a part thereof, contain the entire understanding of the parties hereto with respect to the subject matter contained herein and therein. From and after the execution of a counterpart hereof by the parties hereto, any reference to the Amended Fee Agreement shall be deemed to be a reference to the Amended Fee Agreement as amended hereby.

5. Governing Law. The interpretation and construction of this Amendment and all matters relating hereto, shall be governed by the laws of the State of New York applicable to contracts made and to be performed entirely within the State of New York, without giving effect to any conflict of law provisions thereof.

6. Counterparts. This Amendment may be executed in two or more counterparts, each of which shall constitute an original, and all of which taken together shall constitute one instrument. Any signature page delivered by a facsimile machine shall be binding to the same extent as an original signature page.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

-2-

IN WITNESS WHEREOF, the parties hereto have entered into this Amendment No. 1 to Amended and Restated Fee and Reimbursement Agreement as of the date first written above.

FRESHPET, INC.
By:	/s/ Richard Kassar
Name:	Richard Kassar
Title:	President and Chief Financial Officer

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MIDOCEAN PARTNERS III, L.P.
By:	MidOcean Associates, for and on behalf of its Segregated Portfolio, MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director
MIDOCEAN PARTNERS III-A, L.P.
By:	MidOcean Associates, for and on behalf of its Segregated Portfolio, MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director
MIDOCEAN PARTNERS III-D, L.P.
By:	MidOcean Associates, for and on behalf of its Segregated Portfolio, MidOcean Partners Segregated Portfolio III
By:	/s/ Andrew Spring
Name:	Andrew Spring
Title:	Managing Director

Address:

320 Park Avenue, 16th Floor

New York, NY 10022

Attn: Jonathan Marlow

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

RICHARD KASSAR

/s/ Richard Kassar

Richard Kassar

Address:

200 East End Avenue, Apt. 4F

New York, NY 10128

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

RICHARD C. THOMPSON

/s/ Richard C. Thompson

Richard C. Thompson

Address:

288 Halsey Neck Lane

Southampton, NY 11968

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

RICHARD AND SUZANNE KAYNE LIVING TRUST U/T/D 1/14/99
Richard and Suzanne Kayne Living Trust u/t/d 1/14/99
By:	/s/ Richard A. Kayne
	Richard A. Kayne, Trustee
By:	/s/ Suzanne L. Kayne
	Suzanne L. Kayne, Trustee
Address:
1800 Avenue of The Stars
3rd Floor
Los Angeles, CA 90067

FOR PURPOSES OF SECTION 5 OF

THE AMENDED FEE AGREEMENT:

RICHARD A. KAYNE

/s/ Richard A. Kayne

Richard A. Kayne

Address:

1800 Avenue of The Stars

3^rd Floor

Los Angeles, CA 90067

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

NORRIS TRUST DTD 6/18/02
By:	/s/ Charles A. Norris
	Charles A. Norris, Trustee
By:	/s/ Margaret T. Norris
	Margaret T. Norris, Trustee
Address:
481 Denslow Avenue Los Angeles, CA 90049

FOR PURPOSES OF SECTION 4 OF

THE AMENDED FEE AGREEMENT:

FRESHPET INVESTORS, LLC

By:	/s/ Charles Norris
Name:	Charles Norris
Title:
Address:

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MICHAEL TARGOFF

/s/ Michael Targoff

Michael Targoff

Address:

888 Seventh Ave., 40^th Fl

New York, NY 10106

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

ARMSTRONG TRUST UNDER AGREEMENT DATED SEPTEMBER 14, 2000
Armstrong Trust Under Agreement Dated September 14, 2000
	/s/ William A. Armstrong
	William A. Armstrong, as Trustee
	/s/ Marilyne Armstrong
	Marilyne Armstrong, as Trustee
	Address:
	964 Stow Lane
	Lafayette, CA 94549

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

DAVID J. SHLADOVSKY

/s/ David J. Shladovsky

David J. Shladovsky

Address:

788 Brooktree Road

Pacific Palisades, CA 90272

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MOHN FAMILY TRUST
Mohn Family Trust
By:	/s/ Jarl Mohn
	Jarl Mohn, Trustee
By:	/s/ Pamela Mohn
	Pamela Mohn, Trustee
Address:
100 Wilshire
Suite 1830
Santa Monica, CA 90401

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

JAMES STERN

/s/ James Stern

James Stern

Address:

38 Taylor Lane

Harrison, NY 10528

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

TRUST FBO DAVID STERN
Trust fbo David Stern
By:	/s/ Jonathan Stern
	Jonathan Stern, Trustee
Address:
38 Taylor Lane
Harrison, NY 10528

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

TRUST U/W/O LENORE O. STERN
Trust u/w/o Lenore O. Stern
By:	/s/ James A. Stern
	James A. Stern, Trustee
Address:
38 Taylor Lane
Harrison, NY 10528

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

TRUST FBO PETER STERN
Trust fbo Peter Stern
By:	/s/ Jonathan Stern
	Jonathan Stern, Trustee
Address:
38 Taylor Lane
Harrison, NY 10528

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

PETER NEUWIRTH TRUST DTD 12/9/91
Peter Neuwirth Trust dtd 12/9/91
By:	/s/ Peter H. Neuwirth
	Peter H. Neuwirth, Trustee
Address:

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

DOUGLAS HAMPSON

/s/ Douglas Hampson

Douglas Hampson

Address:

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

JAMES R. WILCOX

/s/ James R. Wilcox

James R. Wilcox

Address:

1297 Sherborne Lane

Powell, OH 43065

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

PATRICIA NEUWIRTH DTD 2/5/91
Patricia Neuwirth dtd 2/5/91
By:	/s/ Patricia Neuwirth
	Patricia Neuwirth, Trustee
Address:
479 Cuesta Way
Los Angeles, CA 90077

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

DAVID L. MAHONEY AND WINNIFRED C. ELLIS 1998 TRUST DTD 6/25/98
David L. Mahoney and Winnifred C. Ellis 1998 Trust dtd 6/25/98
By:	/s/ David Mahoney
Name:	David Mahoney
Title:	Trustee
Address:
121 Jordan Ave.
San Francisco, CA 94118

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

JEFFREY P. HUGHES

/s/ Jeffrey P. Hughes

Jeffrey P. Hughes

Address:

1040 Fifth Avenue

New York, NY 10028

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

THE LIEBERTHAL TRUST DTD 3/23/99
The Lieberthal Trust dtd 3/23/99
By:	/s/ Gary B. Lieberthal
	Gary B. Lieberthal, Trustee
Address:

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

HOWARD & MARCIE ZELIKOW LIVING TRUST DTD 5/30/07
Howard & Marcie Zelikow Living Trust dtd 5/30/07
By:	/s/ Howard M. Zelikow
	Howard M. Zelikow, Trustee
Name:	/s/ Marcie P. Zelikow
	Marcie P. Zelikow
Address:

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

RUDNICK LIVING TRUST DTD 7/22/91
Rudnick Living Trust dtd 7/22/91
By:	/s/ Allan M. Rudnick
	Allan M. Rudnick, Trustee
By:	/s/ Paula Rudnick
	Paula Rudnick, Trustee
Address:
531 Barnaby Road
Los Angeles, CA 90077

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

WILLIAM A. GOLDSTEIN

/s/ William A. Goldstein

William A. Goldstein

Address:

8 Stillman Lane

Pleasantville, NY 10570

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

LAWRENCE S. COBEN

/s/ Lawrence S. Coben

Lawrence S. Coben

Address:

40 West 22^nd Street, # 11

New York, NY 10010

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

LEVINE-ZACHARIUS LIVING TRUST DTD 11/17/1989
Levine-Zacharius Living Trust dtd 11/17/1989
By:	/s/ David O. Levine
	David O. Levine, Trustee
By:	/s/ Sherrie L. Zacharius
	Sherrie L. Zacharius
Address:
10347 Tennessee Ave
Los Angeles, CA 90064

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

DOUGLAS A. & LORI A. SCHUR FAMILY TRUST DTD 5/1/97
Douglas A. & Lori A. Schur Family Trust dtd 5/1/97
By:	/s/ Douglas A. Schur
	Douglas A. Schur, Trustee
By:	/s/ Lori A. Schur
	Lori A. Schur, Trustee
Address:
26717 Mont Calabasas Drive
Calabasas, CA 91302

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

SASQUA FIELDS PARTNERS, LLC
a Delaware limited liability company
By:	/s/ James W. Meyer
Name:	James W. Meyer, as a Managing Director
By:	/s/ David T. Kercher
Name:	David T. Kercher, as a Managing Director
Address:
c/o Sasqua Fields Management LLC
236 Main Street, P.O. Box 621
Southport, CT 06890-0621

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

SILVERS LIVING TRUST DTD 2/11/04
Douglas A. & Lori A. Schur Family Trust dtd 5/1/97
By:	/s/ Craig Silvers
Name:	Craig Silvers
Title:	Trustee
By:	/s/ Jeannine Vanian
Name:	Jeannine Vanian
Title:	Trustee
Address:
10559 Cheviot Drive
Los Angeles, CA 90064

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

LEVINE FAMILY INVESTMENT, LP
a Delaware limited partnership
By:	/s/ David O. Levine
Name:	David O. Levine
Title: a General Partner
By:	/s/ Alan Levine
Name:	Alan Levine
Title: a General Partner
Address:

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

MARILYN S. MOSCRIP

/s/ Marilyn S. Moscrip

Marilyn S. Moscrip

Address:

1026 E. Elizabeth

Pasadena, CA 91104

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

SCOTT RACINE

/s/ Scott Racine

Scott Racine

Address:

4332 Empress Avenue

Encino, CA 91436

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

JOSEPH E. PARZICK

/s/ Joseph E. Parzick

Joseph E. Parzick

Address:

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

WILLIAM DAVID WALTERS

/s/ William David Walters

William David Walters

Address:

410 Route O

Everton, MO 65646

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

LYNN HORN AND MITCHELL CAGNER JTWROS
Lynn Horn and Mitchell Cagner JTWROS
By:	/s/ Lynn Horn        /s/ Mitchell Cagner
Name:	Lynn Horn         Mitchell Cagner
Title:
Address:
59 Wooleys Lane
Great Neck, NY 11023

[SIGNATURE PAGE TO AMENDMENT NO. 2 TO AMENDED AND RESTATED FEE AND REIMBURSEMENT AGREEMENT]

Annex I

Guarantor	Initial Guarantee Amount		Initial Pro-Rata Percentage1			Additional Obligation		Amended Guarantee Amount		Amended Pro-Rata Percentage2			Second Amended Guarantee Amount		Second Amended Pro-Rata Percentage3			Third Amended Guarantee Amount		Third Amended Pro-Rata Percentage4
MidOcean Partners III, L.P.	$	12,988,500		32.47	%		6,493,099.70		19,481,599.70		32.47		$	19,543,446.05		32.57	%	$	20,316,525.40		32.51	%
MidOcean Partners III-A, L.P.	$	6,904,800		17.26	%		3,452,394.60		10,357,194.60		17.26		$	10,390,074.58		17.32	%	$	10,801,074.37		17.28	%
MidOcean Partners III-D, L.P	$	1,106,700		2.77	%		554,505.70		1,661,205.70		2.77		$	1,666,479.37		2.78	%	$	1,732,400.23		2.77	%
Mid Ocean Sub-Total	$	21,000,000		52.5	%				31,500,000		52.5	%	$	31,600,000		52.67	%	$	32,850,000		52.56	%
Dick Kassar	$	400,000		1.00	%		200,000		600,000		1.00		$	700,000		1.17	%	$	741,750.00		1.19	%
Richard Thompson	$	600,000		1.50	%		—		600,000		1.00		$	300,000		0.50	%	$	300,000		0.48	%
Management Sub-Total	$	1,000,000		2.50	%				1,500,000		2.00	%	$	1,000,000		1.67	%	$	1,041,750		1.67	%
Richard and Suzanne Kayne Living Trust u/t/d 1/14/99	$	5,032,286		12.58			2,516,139		7,548,425		12.58							$	7,869,926		12.59	%
Norris Trust dtd 6/18/02	$	2,677,730		6.69			1,338,865		4,016,595		6.69		$	4,116,595		6.86	%	$	4,287,670		6.86	%
Michael Targoff & TGI Holdings, LLC	$	1,373,795		3.43			686,898		2,060,693		3.43							$	2,155,047		3.45	%
Armstrong rust dtd 9/14/00	$	1,200,000		3.00			900,000		2,100,000		3.50							$	2,196,154		3.51	%
David J. Shladovsky	$	1,000,000		2.50			500,000		1,500,000		2.50							$	1,563,888		2.50	%
Mohn Family Trust	$	892,029		2.23			446,015		1,338,044		2.23							$	1,399,310		2.24	%
James Stern, Trust fbo David Stern, Trust u/w/o Lenore O. Stern, Trust fbo Peter Stern	$	887,779		2.22			443,890		1,331,669		2.22							$	1,392,643		2.23	%
Peter Neuwirth Trust dtd 12/9/91	$	662,056		1.66			331,028		993,084		1.66							$	1,038,555		1.66	%
Douglas Hampson	$	552,780		1.38			276,390		829,170		1.38							$	867,136		1.39	%
James R. Wilcox	$	547,300		1.37			273,650		820,950		1.37							$	858,539		1.37	%
Patricia Neuwirth dtd 2/5/91	$	492,250		1.23			246,125		738,375		1.23							$	772,183		1.24	%
David L. Mahoney and Winnifred C. Ellis 1998 Trust dtd 6/25/98	$	419,410		1.05			209,705		629,115		1.05							$	657,921		1.05	%
Jeffrey P. Hughes	$	355,188		0.89			177,594		532,782		0.89							$	557,177		0.89	%
The Lieberthal Trust dtd 3/23/99	$	329,608		0.82			164,804		494,412		0.82							$	517,050		0.83	%
Howard & Marcie Zelikow Living Trust dtd 5/30/07	$	305,081		0.76			152,541		457,622		0.76							$	478,575		0.77	%
Rudnick Living Trust dtd 7/22/91	$	250,000		0.63			125,000		375,000		0.63							$	392,170		0.63	%
William A. Goldstein	$	150,374		0.38			75,187		225,561		0.38							$	235,889		0.38	%
Lawrence S. Coben	$	122,910		0.31			61,455		184,365		0.31							$	192,807		0.31	%
Levine-Zacharius Living Trust dtd 11/17/1989	$	122,454		0.31			61,227		183,681		0.31							$	192,091		0.31	%
Douglas A. & Lori A. Schur Family Trust dtd 5/1/97	$	112,427		0.28			56,214		168,641		0.28							$	176,363		0.28	%
Sasqua Fields Partners, LLC	$	100,000		0.25			—		100,000		0.17							$	104,579		0.17	%
Silvers Living Trust dtd 2/11/04	$	75,000		0.19			87,500		162,500		0.27							$	169,940		0.27	%
Levine Family Investment, LP	$	66,758		0.17			33,379		100,137		0.17							$	104,722		0.17	%
Marilyn S. Moscrip	$	60,261		0.15			30,131		90,392		0.15							$	94,531		0.15	%
Scott Racine	$	39,935		0.10			19,968		59,903		0.10							$	62,646		0.10	%
Joseph E. Parzick	$	140,030		0.35			70,015		210,045		0.35							$	219,662		0.35	%
William David Walters	$	23,247		0.06			11,624		34,871		0.06							$	36,468		0.06	%
Lynn Horn	$	9,312		0.02			4,656		13,968		0.02							$	14,608		0.02	%
Freshpet Investors Sub-total	$	18,000,000		45	%		9,000,000	$	27,000,000		45.5	%	$	28,608,250		45.66	%	$	28,608,250		45.77	%
Total All Guarantees	$	40,000,000		100	%			$	60,000,000		100	%	$	60,000,000		100.00	%	$	62,500,000		100	%

1 Effective from June 8, 2012 through April 14, 2013

2 Effective from April 15, 2013 through September 29, 2013

3 Effective from September 30, 2013

4 Effective from April [     ], 2014

EX-21.1

Exhibit 21.1

Subsidiaries of Freshpet, Inc.

Exact Name of Subsidiaries of Registrant as Specified in the Subsidiary’s Charter	State or Other Jurisdiction of Incorporation or Organization
Professor Connors Canada Inc.	Ontario, Canada

EX-23.1

Exhibit 23.1

Consent of Independent Registered Public Accounting Firm

The Board of Directors

Freshpet, Inc.:

We consent to the use of our report included herein and to the reference to our firm under the heading “Experts” in the prospectus.

/s/ KPMG LLP

Short Hills, New Jersey

September 12, 2014