Billy Cyr
FreshpetAbout Billy Cyr
William B. “Billy” Cyr is Chief Executive Officer of Freshpet and a director since September 2016; age 62 with an A.B. from Princeton University and prior leadership roles at Sunny Delight Beverages and Procter & Gamble . Under his tenure, Freshpet delivered 2024 net sales of $975.2M, net income of $46.9M, and Adjusted EBITDA of $161.8M; five-year total shareholder return was $250.65 on a $100 base as of year-end 2024 . The Board maintains an independent, non-executive Chair and all committees are fully independent, mitigating dual-role risks from the CEO’s board service .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Sunny Delight Beverages Co. | President & CEO | Aug 2004–Feb 2016 | Led consumer beverage company; industry leadership, trade associations |
| Procter & Gamble | VP & GM, North America Juice; Global Nutritional Beverages | 19 years prior to 2004 | Built brand and category capabilities in beverages |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Consumer Brands Association | Board & Executive Committee Member | Since 2002 | Industry advocacy, policy influence |
| American Beverage Association | Director; Executive Committee | 2007–2016; 2012–2016 | Sector leadership and governance |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $620,000 | $620,000 | $668,462 (reflects March 1, 2024 increase to $680,000) |
| Target Bonus % | Not disclosed | Not disclosed | 100% of salary |
| Annual Incentive Paid ($) | $282,720 | $980,685 | $1,584,400 |
Notes: In 2024, NEO annual incentives were based 90% on Net Sales and Adjusted EBITDA before bonus accrual and 10% on Responsible Business Goals, earning 233% of target for Cyr .
Performance Compensation
Annual Incentive (2024)
| Metric | Weight (target) | Threshold | Target | Maximum | Actual | Payout Basis |
|---|---|---|---|---|---|---|
| Net Sales ($MM) | 45% | 900 | 950 | 1,000 | 975.2 | Above target → contributes to 233% total |
| Adj. EBITDA before bonus ($MM) | 45% | 110.0 | 124.1 | 181.0 | 184.3 | Max achieved; capped to plan max |
| Responsible Business Goals (points) | 10% | 6 | 10 | 15 | 9 | 80% of target for RBG element |
Result: Cyr’s approved payout of $1,584,400 at 233% of target .
Long-Term Equity and 2020–2024 Performance Options
| Award | Metric | Goal Range | Actual | Vesting Earned | Instrument Details |
|---|---|---|---|---|---|
| 2020 Performance Stock Options (PSOs) | 2024 Net Sales ($MM) | 800–1,050 | 975.2 | 90.0% of PSO tied to Net Sales | Options earned/exercisable on Feb 10, 2025; exercise price $142.79; expiry Dec 24, 2030 |
| 2020 Performance Stock Options (PSOs) | 2024 Adjusted EBITDA ($MM) | 130.40–187.79 | 161.8 | 82.6% of PSO tied to EBITDA | Combined outcome → total PSO vesting 86.3% |
Vesting outcomes (earned/exercisable Feb 10, 2025): Cyr earned 177,025 of 205,079 PSOs; 28,054 cancelled .
2025 Retention Awards and LT Strategy Shift
- Committee shifted LT equity to annual grants: 50% PSUs and 50% RSUs; PSUs tied to three-year cumulative Net Sales, average Adjusted EBITDA Margin, and Relative TSR; RSUs vest annually over three years .
- One-time January 3, 2025 retention grants to key NEOs including Cyr ($8,000,000 grant date value; 50% PSUs/50% RSUs), with double-trigger vesting protection post-change-in-control and no retirement vesting .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total Beneficial Ownership | 1,322,737 shares (2.71% of outstanding) |
| Breakdown | Includes 38,351 shares and 987,885 options held directly by Cyr; plus additional shares/options held by spouse and family trusts (spousal and descendant trusts) |
| Options Outstanding (CEO) | 1,000,000 time-vested options from 2016 at $10.23 expiring 9/6/2026; 245,385 options from 12/24/2020 at $142.79 expiring 12/24/2030 as of 12/31/2024 |
| RSUs Outstanding (CEO) | None disclosed as of 12/31/2024; retention RSUs granted Jan 3, 2025 (value basis) |
| Ownership Guidelines | CEO must hold stock valued at 4x base salary; five years to comply; enforce 50% retention of vested equity if not in compliance |
| Hedging/Pledging | Company policy prohibits hedging, pledging, and speculative transactions; Insider Trading Policy applies to directors and officers |
| Clawback | Compensation Recoupment Policy aligned with SEC/Nasdaq rules effective Oct 2, 2023; mandatory recovery upon restatement; discretionary recovery for misconduct |
Employment Terms
| Term | Provision |
|---|---|
| Role Start Date | CEO and Director since September 2016 |
| Severance Plan | Freshpet Key Executive Severance Plan adopted Aug 27, 2024; supersedes prior individual agreements |
| CEO Severance (no change-in-control) | 1.5x base salary + target bonus over 18 months; COBRA ~$34,918 estimate |
| CEO Severance (after change-in-control) | 1.5x base salary + target bonus over 36 months; COBRA ~$34,918; no equity acceleration disclosed for CEO |
| Other NEO CoC Equity | CFO and COO receive full acceleration of specified unvested options/RSUs upon change-in-control (illustrative values shown) |
| Triggers | “Involuntary Termination” = termination without cause or resignation for good reason |
| Non-compete/Non-solicit | Plan adds enhanced confidentiality, non-compete, non-solicitation, and IP assignment provisions |
| Tax Gross-ups | None; plan and agreements do not provide tax gross-ups |
Board Governance and Director Service
- Cyr serves as a director; not independent; no committee memberships; does not receive director compensation .
- Board leadership is separated: independent Chair (Walter N. George III); all committees are fully independent; attendees met minimum 75% meeting attendance in 2024 .
- Committee structure: Audit; Nominating & Governance; Compensation & Human Capital; Operations & FSQA—each chaired by independent directors .
Compensation Structure Analysis
- Pay-for-performance alignment: 2024 annual incentive paid at 233% of target driven by above-target Net Sales and max Adjusted EBITDA before bonus accrual; Responsible Business Goals paid at 80% of target .
- Shift from options to PSUs/RSUs in 2025 reduces binary exposure to share price and incorporates multi-factor performance (Net Sales, Adj. EBITDA Margin, Relative TSR) for better alignment and overlapping three-year measurement periods .
- Peer benchmarking: 16-company peer group updated; Freshpet positioned ~40th percentile revenue and 66–75th percentile market cap at approval; Committee targets higher percentile for strategically important roles .
- Say-on-pay approval: Over 97% in 2024 indicating strong investor support for program changes and outcomes .
Director Compensation (context)
| Item | 2024 Non-Employee Director Program |
|---|---|
| Cash Retainer | $70,000; Board Chair $140,000; Committee membership $7,500 (Chair $15,000) |
| Equity | Annual restricted stock awards; Cyr receives no additional pay as CEO-director |
Performance & Track Record
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Net Sales ($MM) | 595.34 | 766.90 | 975.18 |
| Net Income ($MM) | (59.49) | (33.61) | 46.93 |
| Adjusted EBITDA ($MM) | 20.06 | 66.55 | 161.83 |
| TSR (Value of $100) | $89.30 | $146.83 | $250.65 |
Management targets: Updated 2027 goals to $1.8B net sales, 48% adjusted gross margin, 22% adjusted EBITDA margin; free cash flow positive in 2026 .
Risk Indicators & Red Flags
- Hedging/pledging prohibited and clawback policy in place; mitigates misalignment risks .
- No related party transactions requiring disclosure; governance reforms completed (declassification, majority voting, proxy access) .
- Administrative Section 16 filing delays noted for several insiders in March 2024; Company cites oversight .
Say-on-Pay & Shareholder Feedback
- 2024 say-on-pay support >97%; investor engagement led to transition to more traditional annual equity; addition of Relative TSR to PSUs in 2025 .
Investment Implications
- Strong 2024 execution supports pay outcomes; the move to PSUs with Relative TSR should tighten alignment and provide clearer three-year compounding incentives tied to growth and profitability .
- CEO’s significant in-the-money 2016 options expiring in 2026 and earned 2020 options expiring in 2030 create potential liquidity windows; however, hedging/pledging prohibitions and ownership guidelines help maintain alignment .
- Severance economics are sizable but standardized; absence of tax gross-ups and double-trigger vesting on 2025 awards are governance positives amid ongoing scaling and free cash flow objectives .