Scott Morris
FreshpetAbout Scott Morris
Scott Morris, 56, is Freshpet’s co‑founder and President (since March 2016); he previously served as COO (July 2015–Aug 2024), CMO (2014–2015), and SVP Sales & Marketing (2010–2013) . In 2024, Freshpet delivered net sales of $975.2M (+27.2% YoY), Adjusted EBITDA of $161.8M (>140% YoY), and Gross Margin of 40.6%, contributing to a 233% of target annual incentive payout; company TSR translated a $100 investment to $250.65 in 2024 vs $143.37 for peers .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Freshpet | President | 2016–present | Co‑founder; involved in company development and day‑to‑day operations |
| Freshpet | Chief Operating Officer | 2015–2024 | Oversaw operations during scale‑up; transitioned to President-only role in Aug 2024 |
| Freshpet | Chief Marketing Officer | 2014–2015 | Led brand and growth marketing |
| Freshpet | SVP Sales & Marketing | 2010–2013 | Early commercial build‑out |
| The Meow Mix Company | VP Marketing | 2002–2006 | Category brand leadership in pet food |
| Ralston Purina | Various; most recently Pet Food Group Director | 1990–2002 | Sales/marketing leadership in pet nutrition |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Multiple CPG startups | Advisor/Investor | n/a | Focus on social‑mission brands in food/household |
| Hive Brands | Co‑founder | 2020– | Eco‑friendly e‑commerce platform for sustainable food and household goods |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base salary ($) | 510,000 | 526,154 | 550,192 |
| Target bonus (% of salary) | — | — | 70% |
| Actual annual incentive ($) | 146,880 | 529,470 | 905,205 |
| All other comp ($) | 12,200 | 13,200 | 13,800 |
| Total ($) | 669,080 | 1,068,824 | 1,469,197 |
Notes:
- Freshpet increased Scott’s annualized base salary from $530,000 (2023) to $555,000 (2024) as part of market/merit adjustments effective Mar 1, 2024 .
Performance Compensation
2024 Annual Incentive Plan (AIP) – Company metrics and outcomes
| Metric | Weight (target) | Threshold | Target | Maximum | Actual | Payout mechanics |
|---|---|---|---|---|---|---|
| Net Sales ($mm) | 45% | 900 | 950 | 1,000 | 975.2 | Contributed to 270.8% financial score, capped at 250% |
| Adjusted EBITDA before bonus accrual ($mm) | 45% | 110.0 | 124.1 | 181.0 | 184.3 | Maxed; cap applied at 250% for financial element |
| Responsible Business Goals (points) | 10% | 6 | 10 | 15 | 9 | Payout at 80% of target for this element |
| Final AIP payout (% of target) | — | — | — | — | — | 233% (NEOs) |
Responsible Business Goals detail (select):
- Employee NPS target band 8.30–8.49; actual 8.21 (below target)
- Safety TRIR target band 3.27–2.52; actual 3.33 (below target)
- Salaried employee development investment per person target $751–$899; actual $953 (max)
- Cyber/data training completion target 75%–84%; actual 99% (max)
Scott Morris – 2024 AIP outcome
| Item | Value |
|---|---|
| 2024 base salary ($) | 550,192 |
| Target bonus (%) | 70% |
| Implied target bonus ($) | 385,134 (calc from salary × 70%; inputs cited ) |
| Companywide payout | 233% of target |
| Actual bonus paid ($) | 905,205 |
Long‑Term Equity – legacy options and 2025 transition
- 2020 multi‑year performance stock options (PSOs): performance period ended 12/31/2024; payout approved at 86.3% based on 2024 Net Sales and Adjusted EBITDA performance; for Scott, 153,809 options awarded, 132,768 earned and became exercisable Feb 10, 2025 at $142.79 strike, expiring 12/24/2030 .
- 2025 program shift: moving to equally weighted annual PSUs and RSUs for senior leaders; PSUs to include three‑year cumulative Net Sales, average Adjusted EBITDA Margin, and Relative TSR goals (annual program) .
January 3, 2025 Retention Awards (one‑time, off‑cycle)
| Executive | Grant date value | Time‑based RSUs (shares) | Performance‑based RSUs (shares) | Vesting / metrics |
|---|---|---|---|---|
| Scott Morris | $4,000,000 | 13,858 | 13,858 | RSUs vest 1/3 each on 1st–3rd anniversaries; PSUs vest on FY2025–FY2027 cumulative Net Sales (50%) and 3‑yr average Adjusted EBITDA Margin (50%); threshold 80%, max 120%; double‑trigger 100% acceleration on qualifying termination post‑CoC; no retirement vesting . |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial ownership | 437,250 shares (<1%) as of Apr 23, 2025; total shares outstanding 48,774,818 |
| Stock ownership guidelines | 300% of salary for NEOs (5 years to comply); all NEOs in compliance or progressing |
| Hedging/pledging | Company policy prohibits hedging, pledging, and speculative transactions for officers/directors |
| Options outstanding (12/31/2024) | 35,868 @ $8.90 exp 9/27/2026; 81,949 @ $11.00 exp 4/3/2027; 13,015 @ $63.87 exp 4/1/2030; 184,038 @ $142.79 exp 12/24/2030 (exercisable status per table) |
| 2024 option activity | 51,132 shares acquired on exercise; value realized $7,043,394 |
Reference price: FRPT closed at $148.11 on 12/31/2024 (used for valuation in proxy tables) .
Employment Terms
| Scenario (as of 12/31/2024) | Cash | COBRA | Equity | Total |
|---|---|---|---|---|
| Involuntary termination (without cause) | $1,887,000 | $48,911 | — | $1,935,911 |
| Involuntary termination after change in control | $2,830,500 | $48,911 | — | $2,879,411 |
Additional terms and governance:
- Executive Severance Plan adopted to standardize provisions (replacing case‑by‑case) .
- 2025 retention RSUs/PSUs carry double‑trigger 100% vesting on qualifying termination post‑CoC; no retirement vesting .
- Clawback: Dodd‑Frank–compliant compensation recoupment policy (retroactive to Oct 2, 2023); no clawbacks in 2024 .
- Insider policy: robust restrictions; includes blackout and trading controls .
- Non‑compete framework strengthened in 2024 as part of governance updates .
Track Record, Value Creation, and Execution Risk
- 2020–2024 performance options vested at 86.3% on aggressive four‑year sales and EBITDA goals (CAGRs required: >33% Sales, >43% Adjusted EBITDA); Scott earned 132,768 options (now exercisable) at $142.79 strike, expiring 12/24/2030 .
- 2024 operational outperformance: exceeded sales target and maxed Adjusted EBITDA before bonus accrual in AIP; NEO payout 233% of target .
- Company TSR and fundamentals: 2024 TSR rose to 250.65 vs peer 143.37; net income turned positive at $46.9M; net sales $975.2M .
Compensation Structure Analysis
- Year‑over‑year mix shifts: 2024 pay predominantly cash (no new equity for Scott in 2024), with 2025 introducing material equity via RSUs/PSUs (50/50) to re‑establish long‑term retention and performance linkage .
- Metric rigor: AIP remains anchored to Net Sales and Adjusted EBITDA before bonus accrual; 2025 long‑term plan adds Relative TSR to PSUs (annual LTI program) while retention PSUs focus on internal Sales/EBITDA Margin .
- Governance safeguards: no hedging/pledging; clawback in place; formalized severance plan; high say‑on‑pay support (97% in 2024) .
Vesting Schedules and Insider Selling Pressure
- Near‑term events: 2020 PSOs became exercisable Feb 10, 2025; potential incremental exercises could create episodic supply if monetized .
- 2025 retention RSUs vest on 1/3 tranches in 2026/2027/2028; PSUs eligible 2028 based on FY2025–FY2027 performance; double‑trigger CoC acceleration may front‑load vesting only on qualifying termination post‑CoC .
- 2024 activity already saw 51,132 options exercised ($7.04M value realized), evidencing some liquidity events in the period .
Investment Implications
- Alignment: 2025 retention grants re‑anchor Scott’s incentives to multi‑year Sales and margin outcomes and restore meaningful unvested equity; prohibition on hedging/pledging and stock ownership guidelines further align interests .
- Performance leverage: AIP and PSUs tied to top‑line and margin expansion (plus Relative TSR in the annual LTI program) should keep pay sensitive to profitable growth and market outcomes .
- Retention risk: Executive Severance Plan plus sizable 2025 equity reduce near‑term departure risk; severance economics indicate robust protection (cash of ~$1.89M no‑CoC; ~$2.83M post‑CoC), with double‑trigger equity only under CoC termination .
- Trading signals: Option exercises in 2024 and the fresh 2025 vesting/exercisability could create supply around vest dates/10b5‑1 plans; monitor Form 4s for cadence and size of sales relative to ownership guideline compliance .