UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________

FORM 10-Q

_____________________

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 30, 2014

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________to _____________.

Commission File Number 001-35844

___________________________________

Pinnacle Foods Inc.

(Exact name of registrant as specified in its charter)

___________________________________

Delaware	35-2215019
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
399 Jefferson Road Parsippany, New Jersey	07054
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (973) 541-6620

___________________________________

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  ý No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes  ý    No ¨

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 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 (Do not check if a smaller reporting company)	ý	Smaller Reporting Company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)

Yes  ¨    No  ý

The Registrant had 117,296,568 shares of common stock, $0.01 par value, outstanding at May 9, 2014.

	TABLE OF CONTENTS FORM 10-Q	Page No.
PART I - FINANCIAL INFORMATION		1
ITEM 1:	FINANCIAL STATEMENTS (UNAUDITED)	1
CONSOLIDATED STATEMENTS OF OPERATIONS		1
CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS		2
CONSOLIDATED BALANCE SHEETS		3
CONSOLIDATED STATEMENTS OF CASH FLOWS		4
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY		5
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)		6
1.	Summary of Business Activities	6
2.	Interim Financial Statements	6
3.	Acquisition	7
4.	Fair Value Measurements	8
5.	Other Expense (Income), net	9
6.	Shareholders' Equity, Equity-Based Compensation Expense and Earnings Per Share	9
7.	Balance Sheet Information	14
8.	Goodwill, Tradenames and Other Assets	15
9.	Debt and Interest Expense	18
10.	Pension and Retirement Plans	22
11.	Financial Instruments	23
12.	Commitments and Contingencies	27
13.	Related Party Transactions	27
14.	Segments	28
15.	Provision for Income Taxes	30
16.	Guarantor and Nonguarantor Statements	31
17.	Subsequent Events	37
ITEM 2:	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	39
ITEM 3:	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	53
ITEM 4:	CONTROLS AND PROCEDURES	53
PART II - OTHER INFORMATION		53
ITEM 1:	LEGAL PROCEEDINGS	53
ITEM 1A:	RISK FACTORS	54
ITEM 2:	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	54
ITEM 3:	DEFAULTS UPON SENIOR SECURITIES	54
ITEM 4:	MINE SAFETY DISCOSURES	54
ITEM 5:	OTHER INFORMATION	55
ITEM 6:	EXHIBITS	59
SIGNATURES		58

2

PART I - FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS

PINNACLE FOODS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(thousands, except per share amounts)

	Three months ended
	March 30, 2014		March 31, 2013
Net sales	$	644,039	$	612,981
Cost of products sold	477,378		458,140
Gross profit	166,661		154,841
Operating expenses
Marketing and selling expenses	44,128		45,628
Administrative expenses	25,977		22,558
Research and development expenses	2,482		2,327
Other expense (income), net	3,983		3,657
Total operating expenses	76,570		74,170
Earnings before interest and taxes	90,091		80,671
Interest expense	24,367		40,656
Interest income	26		3
Earnings before income taxes	65,750		40,018
Provision for income taxes	25,002		15,222
Net earnings	$	40,748	$	24,796
Net earnings per share
Basic	$	0.35	$	0.31
Weighted average shares outstanding- basic	115,592		81,264
Diluted	$	0.35	$	0.29
Weighted average shares outstanding- diluted	116,687		86,268
Dividends declared	$	0.21	$	—

See accompanying Notes to Unaudited Consolidated Financial Statements

1

PINNACLE FOODS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (unaudited)

(thousands of dollars)

	Three months ended
	March 30, 2014			March 31, 2013
Net earnings	$	40,748		$	24,796
Other comprehensive (loss) earnings
Foreign currency translation	(474		)	(2		)
Net (loss) gain on financial instrument contracts	(7,741		)	604
Reclassifications into earnings:
Financial instrument contracts	(372		)	662
Loss on pension actuarial assumption adjustments	143			456
Tax benefit (provision) on other comprehensive earnings	3,363			(597		)
Total other comprehensive (loss) earnings - net of tax	(5,081		)	1,123
Total comprehensive earnings	$	35,667		$	25,919

See accompanying Notes to Unaudited Consolidated Financial Statements

2

PINNACLE FOODS INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (unaudited)

(thousands of dollars, except share and per share amounts)

	March 30, 2014			December 29, 2013
Current assets:
Cash and cash equivalents	$	158,036		$	116,739
Accounts receivable, net of allowances of $6,419 and $5,849, respectively	185,597			164,664
Inventories	339,791			361,872
Other current assets	8,372			7,892
Deferred tax assets	145,875			141,142
Total current assets	837,671			792,309
Plant assets, net of accumulated depreciation of $311,830 and $297,103, respectively	529,752			523,270
Tradenames	1,951,392			1,951,392
Other assets, net	173,952			186,125
Goodwill	1,628,095			1,628,095
Total assets	$	5,120,862		$	5,081,191
Current liabilities:
Short-term borrowings	$	2,419		$	2,437
Current portion of long-term obligations	24,582			24,580
Accounts payable	155,769			142,353
Accrued trade marketing expense	40,096			37,060
Accrued liabilities	90,628			99,755
Dividends payable	25,415			25,119
Total current liabilities	338,909			331,304
Long-term debt (includes $63,889 and $63,796 owed to related parties, respectively)	2,471,018			2,476,167
Pension and other postretirement benefits	47,154			49,847
Other long-term liabilities	25,535			24,560
Deferred tax liabilities	626,976			601,272
Total liabilities	3,509,592			3,483,150
Commitments and contingencies (Note 12)
Shareholders' equity:
Pinnacle preferred stock: $.01 per share, 50,000,000 shares authorized, none issued	—			—
Pinnacle common stock: par value $.01 per share, 500,000,000 shares authorized; issued and outstanding 117,213,484 and 117,231,853, respectively	1,172			1,172
Additional paid-in-capital	1,331,032			1,328,847
Retained earnings	291,644			275,519
Accumulated other comprehensive loss	(12,578		)	(7,497		)
Total shareholders' equity	1,611,270			1,598,041
Total liabilities and shareholders' equity	$	5,120,862		$	5,081,191

See accompanying Notes to Unaudited Consolidated Financial Statements

3

PINNACLE FOODS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

(thousands of dollars)

	Three months ended
	March 30, 2014			March 31, 2013
Cash flows from operating activities
Net earnings	$	40,748		$	24,796
Non-cash charges (credits) to net earnings
Depreciation and amortization	20,380			19,270
Amortization of discount on term loan	634			314
Amortization of debt acquisition costs	1,024			1,713
Change in value of financial instruments	422			(414		)
Equity-based compensation charge	2,112			175
Pension expense, net of contributions	(2,681		)	(416		)
Gain on sale of assets held for sale	—			(701		)
Other long-term liabilities	383			(613		)
Deferred income taxes	24,352			14,502
Changes in working capital
Accounts receivable	(21,198		)	(24,729		)
Inventories	21,981			32,007
Accrued trade marketing expense	3,179			6,317
Accounts payable	12,045			(10,297		)
Accrued liabilities	(9,115		)	11,053
Other current assets	(327		)	(5,233		)
Net cash provided by operating activities	93,939			67,744
Cash flows from investing activities
Capital expenditures	(22,406		)	(18,242		)
Proceeds from sale of plant assets	—			1,775
Net cash used in investing activities	(22,406		)	(16,467		)
Cash flows from financing activities
Net proceeds from issuance of common stock	73			—
Repurchases of equity	—			(187		)
Dividends paid	(24,310		)	—
Repayments of long-term obligations	(5,388		)	(10,581		)
Proceeds from short-term borrowings	960			1,107
Repayments of short-term borrowings	(978		)	(1,415		)
Repayment of capital lease obligations	(674		)	(550		)
Net cash used in financing activities	(30,317		)	(11,626		)
Effect of exchange rate changes on cash	81			162
Net change in cash and cash equivalents	41,297			39,813
Cash and cash equivalents - beginning of period	116,739			92,281
Cash and cash equivalents - end of period	$	158,036		$	132,094
Supplemental disclosures of cash flow information:
Interest paid	$	18,594		$	36,325
Interest received	26			3
Income taxes paid	957			304
Non-cash investing and financing activities:
New capital leases	282			4,668
Dividends payable	25,415			—

See accompanying Notes to Unaudited Consolidated Financial Statements

4

PINNACLE FOODS INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (unaudited)

(thousands of dollars, except share and per share amounts)

	Common Stock				Additional Paid In Capital			Retained earnings			Accumulated Other Comprehensive Loss			Total Shareholders' Equity
	Shares		Amount
Balance, December 30, 2012	81,210,672		$	812	$	696,512		$	252,955		$	(61,553	)	$	888,726
Equity contributions:
Share issuance	2,700,767		27		(27		)							—
Shares repurchased	(8,054	)	—		(187		)							(187		)
Equity related compensation					175									175
Comprehensive earnings								24,796			1,123			25,919
Balance, March 31, 2013	83,903,385		$	839	$	696,473		$	277,751		$	(60,430	)	$	914,633
Balance, December 29, 2013	117,231,853		$	1,172	$	1,328,847		$	275,519		$	(7,497	)	$	1,598,041
Equity contributions:
Share issuance	16,632		—		73									73
Non-vested Shares forfeited	(35,001	)	—		—									—
Equity related compensation					2,112									2,112
Dividends ($0.21 per share)*								(24,623		)				(24,623		)
Comprehensive earnings								40,748			(5,081		)	35,667
Balance, March 30, 2014	117,213,484		$	1,172	$	1,331,032		$	291,644		$	(12,578	)	$	1,611,270

See accompanying Notes to Unaudited Consolidated Financial Statements

* $0.21 per share quarterly, declared February 2014

5

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

1. Summary of Business Activities

Business Overview

Pinnacle Foods Inc. (hereafter referred to as “Pinnacle” or the “Company”), formerly known as Crunch Holding Corp., is a holding company whose sole asset is 100% ownership of Peak Finance Holdings LLC (“PFH”). PFH is a holding company whose sole asset is 100% ownership of Pinnacle Foods Finance LLC (“Pinnacle Foods Finance”). The Company is majority owned by affiliates of The Blackstone Group L.P. ("Blackstone"). In October 2013, approximately 30.7 million shares previously owned by certain Blackstone Funds were transferred to BCPV Pinnacle Holdings LLC.  The transfer of these shares did not result in any change in beneficial ownership for any of the Blackstone Funds.

The Company is a leading manufacturer, marketer and distributor of high quality, branded convenience food products, the products and operations of which are managed and reported in three operating segments: (i) Birds Eye Frozen, (ii) Duncan Hines Grocery and (iii) Specialty Foods. The Company’s United States retail frozen vegetables (Birds Eye), frozen complete bagged meals (Birds Eye Voila!), frozen seafood (Van de Kamp’s, Mrs. Paul’s), full-calorie single-serve frozen dinners and entrées (Hungry-Man), frozen breakfast (Aunt Jemima), frozen and refrigerated bagels (Lender’s), and frozen pizza for one (Celeste) are reported in the Birds Eye Frozen Division. The Company’s baking mixes and frostings (Duncan Hines), liquid and dry-mix salad dressings (Wish-Bone, Western and Bernstein's), shelf-stable pickles (Vlasic), table syrups (Mrs. Butterworth’s and Log Cabin), canned meat (Armour, Nalley and Brooks), pie and pastry fillings (Duncan Hines Comstock and Wilderness), barbecue sauces (Open Pit) and all Canadian operations are reported in the Duncan Hines Grocery Division. The Specialty Foods Division consists of snack products (Tim’s Cascade and Snyder of Berlin) and the Company’s food service and private label businesses.

History and Current Ownership

Since 2001, the Company and its predecessors have been involved in several business combinations to acquire certain assets and liabilities related to the brands discussed above.

On December 23, 2009, Pinnacle Foods Group LLC (“PFG LLC”), an entity wholly owned by Pinnacle Foods Finance, purchased Birds Eye Foods, Inc. (the “Birds Eye Acquisition”).

On March 12, 2013, the Company’s board of directors authorized a 55.2444 for 1 split of the common stock. The split became effective on the date of approval. The Company retained the par value of $0.01 per share for all shares of common stock. All references to numbers of common shares and per-share data in the accompanying financial statements have been adjusted to reflect the stock split on a retroactive basis. Shareholders’ equity reflects the stock split by reclassifying from “Additional paid-in capital” to “Common stock” an amount equal to the par value of the additional shares arising from the split.

On March 27, 2013, the U.S. Securities and Exchange Commission ("SEC") declared effective the Company's registration statement on Form S-1 related to its initial public offering ("IPO"). The Company's common stock began trading on the New York Stock Exchange ("NYSE"), under the ticker symbol PF, on March 28, 2013. In connection with the IPO, 2,618,307 additional shares were issued through the exercise of a warrant agreement by Peak Holdings LLC ("Peak Holdings") which was the majority owner of the Company prior to the IPO. Immediately thereafter, the warrant agreement was terminated and Peak Holdings was liquidated. On April 3, 2013, the IPO closed in which the Company issued and sold 33,350,000 shares of common stock. None of Blackstone, Directors or management of the Company sold any shares as part of the IPO. The Company received approximately $623.9 million in net proceeds ($667.0 million of gross proceeds net of $43.1 million of underwriting discounts and other fees) from the offering, which were used to pay down debt. See Note 9 of the Consolidated Financial Statements "Debt and Interest Expense" for further details.

On December 11, 2013, the SEC declared effective the Company's registration statement on Form S-1 related to a secondary offering. In connection with this offering, Blackstone sold 19,550,000 shares which reduced their ownership to approximately 51%. The Company did not receive any proceeds from the sale.

2. Interim Financial Statements

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting primarily of normal recurring adjustments) necessary for a fair statement of the Company’s financial position as of March 30, 2014, the results of operations for the three months ended March 30, 2014 and March 31, 2013, and the cash flows for the three

6

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

months ended March 30, 2014 and March 31, 2013. The results of operations are not necessarily indicative of the results to be expected for the full fiscal year. The accompanying unaudited consolidated financial statements and notes thereto should be read in conjunction with the audited consolidated financial statements and notes thereto for the fiscal year ended December 29, 2013.

3. Acquisition

Acquisition of the Wish-Bone and Western Salad Dressings Business.

On October 1, 2013, the Company acquired substantially all of the assets (the "Acquisition") of the Wish-Bone and Western Salad Dressings Business ("Wish-Bone") from Conopco Inc. and affiliates (“Unilever”), which are subsidiaries of Unilever PLC. The acquired portfolio includes a broad range of liquid and dry-mix salad dressing flavors under the Wish-Bone and Western brand names that are highly complementary to the Company's existing product offerings.

The Company accounts for business combinations by using the acquisition method of accounting. This provides that goodwill and other intangible assets with indefinite lives are not to be amortized, but tested for impairment on an annual basis. Acquisition costs are expensed as incurred. The Acquisition has been accounted for in accordance with these standards.

The cost of the Acquisition was $575,164. The following table summarizes the allocation of the total cost of the Acquisition to the assets acquired:

Assets acquired:
Inventories	$	20,029
Plant assets	5,871
Tradenames	347,400
Distributor relationships and other agreements	14,700
Deferred tax assets	564
Goodwill	186,600
	$	575,164

Based upon the allocation, the value assigned to intangible assets and goodwill totaled $548.7 million at the valuation date. The goodwill was generated primarily as a result of expected synergies to be achieved in the acquisition. Distributor relationships are being amortized on an accelerated basis over 30 years. This useful life was based on an attrition rate based on industry experience, which management believes is appropriate in the Company's circumstances. The Company has also assigned $347.4 million to the value of the tradenames acquired, which are not subject to amortization but are reviewed annually for impairment. Goodwill, which is also not subject to amortization, totaled $186.6 million. Tax deductible goodwill of $185.7 million existed as of the closing of the acquisition. The entire Acquisition was allocated to the Duncan Hines Grocery segment.

The Acquisition was financed through borrowings of $525.0 million in term loans (“Tranche H Term Loans”), $75.3 million of cash on hand, less transaction costs of $6.1 million in the fiscal year ended December 29, 2013 and deferred financing costs of $10.5 million. Included in the transaction costs of $6.1 million for the fiscal year ended December 29, 2013 are: $4.3 million in merger, acquisition and advisory fees and $1.8 million in legal, accounting and other professional fees. The Company also incurred $8.5 million in original issue discount in connection with the Tranche H Term Loans. This was recorded in Long-term debt on the Consolidated Balance Sheets and is being amortized over the life of the loan using the effective interest method. For more information, see Note 9 to the Consolidated Financial Statements, Debt and Interest Expense.

Pro forma Information

The following unaudited pro forma summary presents the Company's consolidated results of operations as if Wish-Bone had been acquired on December 31, 2012. These amounts adjusted Wish-Bone's historical results to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to plant assets and intangible assets had been applied from December 31, 2012, together with the consequential tax effects. These adjustments also reflect the additional interest expense incurred on the debt to finance the purchase. The pro forma financial information presented below is for informational

7

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

purposes only and is not indicative of the results of operations that would have been achieved if the acquisition and borrowings undertaken to finance the acquisition had taken place at the beginning of 2013.

Amounts in millions:

	Three months ended March 31, 2013 (unaudited)
Net sales	$	665.8
Net earnings	$	30.6

4. Fair Value Measurements

The authoritative guidance for financial assets and liabilities discusses valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). The guidance utilizes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels:

Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

Level 3: Unobservable inputs that reflect the Company’s assumptions.

The Company’s financial assets and liabilities subject to recurring fair value measurements and the required disclosures are as follows:

	Fair Value as of March 30, 2014		Fair Value Measurements Using Fair Value Hierarchy						Fair Value as of December 29, 2013		Fair Value Measurements Using Fair Value Hierarchy
			Level 1		Level 2		Level 3				Level 1		Level 2		Level 3
Assets
Interest rate derivatives	$	21,389	$	—	$	21,389	$	—	$	29,518	$	—	$	29,518	$	—
Foreign currency derivatives	888		—		888		—		307		—		307		—
Commodity derivatives	118		—		118		—		543		—		543		—
Total assets at fair value	$	22,395	$	—	$	22,395	$	—	$	30,368	$	—	$	30,368	$	—
Liabilities
Interest rate derivatives	$	1,768	$	—	$	1,768	$	—	$	1,904	$	—	$	1,904	$	—
Total liabilities at fair value	$	1,768	$	—	$	1,768	$	—	$	1,904	$	—	$	1,904	$	—

The Company manages economic risks, including interest rate, liquidity and credit risk, primarily by managing the amount, sources and duration of its debt funding and the use of derivative financial instruments. The primary risks managed by using derivative instruments are interest rate risk, foreign currency exchange risk and commodity price risk.

The valuations of these instruments are determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market-based inputs, including interest rate, commodity, and foreign exchange forward curves. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted

8

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

future fixed cash payments (or receipts) and the discounted expected variable cash receipts (or payments). The variable cash receipts (or payments) are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves. To comply with the provisions of the authoritative guidance for fair value disclosure, the Company incorporates credit valuation adjustments to appropriately reflect both its own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. In adjusting the fair value of its derivative contracts for the effect of non-performance risk, the Company has considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees. The Company had no fair value measurements based upon significant unobservable inputs (Level 3) as of March 30, 2014 or December 29, 2013.

In addition to the instruments named above, the Company also makes fair value measurements in connection with its annual goodwill and trade name impairment testing. These measurements would fall into Level 3 of the fair value hierarchy.

5. Other Expense (Income), net

	Three months ended
	March 30, 2014			March 31, 2013
Other expense (income), net consists of:
Amortization of intangibles/other assets	$	4,175		$	3,872
Royalty income and other	(192		)	(215		)
Total other expense (income), net	$	3,983		$	3,657

6. Shareholders' Equity, Equity-Based Compensation Expense and Earnings Per Share

Equity-based Compensation

The Company has two long-term incentive programs: The 2007 Stock Incentive Plan and the 2013 Omnibus Incentive Plan. Prior to March 28, 2013, Peak Holdings, the former parent of the Company also had the 2007 Unit Plan, which was terminated in connection with the Company's IPO. Equity-based compensation expense recognized during the period is based on the value of the portion of equity-based payment awards that is ultimately expected to vest during the period. As equity-based compensation expense recognized in the Consolidated Statements of Operations is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. The authoritative guidance for equity compensation requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

The Company currently uses the Black-Scholes pricing model as its method of valuation for equity option awards. The fair value of the options granted during the three months ended March 30, 2014 and March 31, 2013, respectively, was estimated on the date of the grant using the Black-Scholes model with the following weighted average assumptions:

	March 30, 2014		March 31, 2013
Risk-free interest rate	2.2	%	1.1	%
Expected time to option exercise	6.50 years		6.50 years
Expected volatility of Pinnacle Foods Inc. stock	35	%	35	%
Expected dividend yield on Pinnacle Foods Inc. stock	3.1	%	3.6	%	*

* Dividend yield is based on the weighted average of the expected yield at the time of each grant, 3.6% in 2013, resulting from options granted at the IPO price of $20.00 a share.

Volatility was based on the average volatility of a group of publicly traded food companies. The Company estimates the annual forfeiture rates to be approximately 10% under its long-term incentive plans.

9

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Expense Information

The following table summarizes equity-based compensation expense which was allocated as follows:

	Three months ended
	March 30, 2014			March 31, 2013
Cost of products sold	$	197		$	23
Marketing and selling expenses	271			70
Administrative expenses	1,603			77
Research and development expenses	41			5
Pre-tax equity-based compensation expense	2,112			175
Income tax benefit	(698		)	(6		)
Net equity-based compensation expense	$	1,414		$	169

As of March 30, 2014, cumulative unrecognized equity compensation expense of the unvested portion of shares for the Company's two long-term incentive programs was $37,606. The weighted average period over which vesting will occur is approximately 4.9 years for the 2007 Stock Incentive Plan and 2.9 years for the 2013 Omnibus Plan. Options under the plans have a termination date of 10 years from the date of issuance.

2007 Stock Incentive Plan

The Company adopted an equity option plan (the “2007 Stock Incentive Plan”) providing for the issuance of up to 1,104,888 shares of the Company's common stock through the granting of nonqualified stock options. For options granted pursuant to the 2007 Stock Incentive Plan from 2007 to 2009, generally 25% of the options will vest ratably over five years (“Time-Vested Options”), subject to full acceleration upon a change of control. Fifty percent of the options vest ratably over five years if annual or cumulative Adjusted EBITDA targets, as defined, are met (Performance Options). The final 25% of the options vest upon a liquidity event, if a 12% annual internal rate of return is attained by Blackstone (Exit Options). Subsequent to 2009, the Company awarded options in the form of Time-Vested Options (25%) and Performance Options (75%) to certain employees. The options have, essentially, the same vesting provisions as stated above, including the provisions that if there is a change of control or liquidity event and if a 12% annual internal rate of return is attained by Blackstone, then all the Performance Options will also vest and become exercisable. Prior to March 1, 2013, this annual internal rate of return target was 20%, but the Compensation Committee of the Board of Directors reduced the target for vesting purposes on that date from 20% to 12% to reflect changes in the food industry environment since the plan was adopted. Subsequent to the adoption of the 2013 Omnibus Incentive Plan (as further described below), there will be no more grants under this plan.

10

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

The following table summarizes the equity option transactions under the 2007 Stock Incentive Plan:

		Number of Shares		Weighted Average Exercise Price		Weighted Average Fair Value at Grant Date		Weighted Average Remaining Life	Aggregate Intrinsic Value (000's)
Outstanding, December 29, 2013		314,396		$	10.22	$	6.13	5.51	$	5,352
	Granted	—		—		—
	Exercised	(7,497	)	9.67		4.33
	Forfeitures	(7,312	)	12.22		7.28
Outstanding, March 30, 2014		299,587		10.18		$	6.15	5.23	5,799
Exercisable, March 30, 2014		110,951		$	9.69	$	4.24	4.71	$	2,203

2007 Unit Plan

Peak Holdings, the former parent of Pinnacle Foods Inc., adopted an equity plan (the “2007 Unit Plan”) providing for the issuance of profit interest units ("PIUs") in Peak Holdings. Certain employees had been given the opportunity to invest in Peak Holdings through the purchase of Peak Holding's Class A-2 Units. In addition, from 2007 to 2009, each manager who invested in Class A-2 Units of Peak Holdings LLC was awarded profit interests in Peak Holdings LLC in the form of Class B-1, Class B-2 and Class B-3 Units. Generally 25% of the PIUs vested ratably over five years (“Class B-1 Units”), subject to full acceleration upon a change of control. Fifty percent of the PIUs vested ratably over five years depending on whether annual or cumulative EBITDA targets are met (“Class B-2 Units”). The final 25% of the PIUs granted vested either on a liquidity event that returns a 12% annual internal rate of return to Blackstone (“Class B-3 Units”). Subsequent to 2009, the Company awarded PIUs to certain employees in the form of Class B-1 Units (25%) and Class B-2 Units (75%). The Class B-1 Units and Class B-2 Units had essentially the same vesting provisions as stated above, including the provisions that if there was a liquidity event and if a 12% annual internal rate of return was attained by Blackstone, then all the Class B-2 units also vested and became exercisable. Prior to March 1, 2013, this annual internal rate of return target was 20%, but the Compensation Committee of the Board of Directors reduced the target for vesting purposes on that date from 20% to 12% to reflect changes in the food industry environment since the plan was adopted.

In connection with the Company's IPO, Peak Holdings was dissolved resulting in the termination of the 2007 Unit Plan and the adoption of the 2013 Omnibus Incentive Plan (as further described below). As a result of the dissolution, the holders of units of Peak Holdings were distributed the assets of Peak Holdings. As the sole assets of Peak Holdings were shares of the Company's common stock, units were converted into shares of common stock. The number of shares of common stock delivered to the equity holder as a result of the conversion had the same intrinsic value as the Class A-2 Units held by the equity holder prior to such conversion. Additionally, in connection with the dissolution, all PIUs were converted into shares or restricted shares of the Company's common stock. Vested PIUs were converted into shares of common stock and unvested PIUs were converted into unvested restricted shares of our common stock, which are subject to vesting terms substantially similar to those applicable to the unvested PIU immediately prior to the conversion. The number of shares delivered under the 2013 Omnibus Incentive Plan, 1,546,355, have the same intrinsic value as the PIUs immediately prior to such conversion.

2013 Omnibus Incentive Plan

In connection with the IPO, the Company adopted an equity incentive plan (the “2013 Omnibus Incentive Plan”) providing for the issuance of up to 11,300,000 shares of the Company's common stock which will be reserved for issuance under (1) equity awards granted as a result of the conversion of unvested PIUs into restricted common stock of the Company, (2) stock options and other equity awards granted in connection with the completion of the IPO, and (3) awards granted by the Company under the 2013 Omnibus Plan following the completion of the IPO. Pursuant to the 2013 Omnibus Plan, certain officers, employees, managers, directors and other persons are eligible to receive grants of equity based awards, as permitted by applicable law.

On March 27, 2013, in connection with the IPO, the Company issued 2,310,000 "Founders Grants" options under the 2013 Omnibus Plan. The options vest in full at the end of three years. Additionally, 82,460 non-vested shares were issued which also vest in full

11

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

at the end of three years. Pursuant to his employment agreement, on April 3, 2013, Robert J. Gamgort, the Chief Executive Officer, became entitled to 200,000 shares of common stock, subject to his continued service through April 3, 2014. On April 3, 2014, net of tax withholdings, 96,300 shares were issued to Mr. Gamgort. On August 1, 2013, an additional 66,042 non-vested shares and 155,575 options were issued to various employees. The non-vested shares vest in full at the end of four years while the options vest in full at the end of three years. On December 2, 2013, 30,626 options were issued that vest in full at the end of three years. On January 2, 2014, 9,135 non-vested shares and 30,447 options were issued. Both the non-vested shares and the options vest in full at the end of three years.

The following table summarizes the equity option transactions under the 2013 Omnibus Plan:

		Number of Options		Weighted Average Exercise Price		Weighted Average Fair Value at Grant Date		Weighted Average Remaining Life	Aggregate Intrinsic Value (000's)
Outstanding, December 29, 2013		2,330,491		$	20.47	$	4.82	9.27	15,782
	Granted	30,447		27.37		7.33
	Exercised	—		—		—
	Forfeitures	(46,160	)	20.00		4.63
Outstanding, March 30, 2014		2,314,778		20.57		$	4.86	9.03	$	20,768
Exercisable, March 30, 2014		—		$	—	$	—	0	$	—

The following table summarizes the changes in non-vested shares.

		Number of Shares		Weighted Average Fair Value at Grant Date		Weighted Average Remaining Life	Aggregate Intrinsic Value (000's)
Non-vested shares at December 29, 2013		1,645,718		$	20.34	6.35	$	44,829
	Granted	9,135		27.37
	Forfeitures	(25,388	)	20.00
	Vested	(10,723	)	20.00
Non-vested shares at March 30, 2014		1,618,742		$	20.39	6.11	$	47,818

Other Comprehensive Earnings

The following table presents amounts reclassified out of Accumulated Other Comprehensive Loss ("AOCL") and into Net earnings for the three months ended March 30, 2014 and March 31, 2013.

12

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Gain/(Loss)	Amounts Reclassified from AOCL
	Three months ended			Three months ended
Details about Accumulated Other Comprehensive Earnings Components	March 30, 2014			March 31, 2013				Reclassified from AOCL to:
Gains and losses on financial instrument contracts
Interest rate contracts	$	(41	)	$	(854	)		Interest expense
Foreign exchange contracts	413			192				Cost of products sold
Total pre-tax	372			(662		)
Tax benefit (expense)	(207		)	340				Provision for income taxes
Net of tax	165			(322		)
Pension actuarial assumption adjustments
Amortization of actuarial loss	(143		)	(456		)	(a)	Cost of products sold
Tax benefit	55			176				Provision for income taxes
Net of tax	(88		)	(280		)
Net reclassifications into net earnings	$	77		$	(602	)

(a) This is included in the computation of net periodic pension cost (see Note 10 for additional details).

Earnings Per Share

Basic earnings per common share is computed by dividing net earnings or loss for common shareholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per common share are calculated by dividing net earnings by weighted-average common shares outstanding during the period plus dilutive potential common shares, which are determined as follows:

	Three months ended
	March 30, 2014	March 31, 2013
Weighted-average common shares	115,592,299	81,263,994
Effect of dilutive securities:
Warrants	—	4,907,645
Options to purchase common stock and non-vested shares	1,094,602	96,583
Dilutive potential common shares	116,686,901	86,268,222

Dilutive potential common shares are calculated in accordance with the treasury stock method, which assumes that proceeds from the exercise of all warrants and options are used to repurchase common stock at market value. The amount of shares remaining after the proceeds are exhausted represents the potentially dilutive effect of the securities. For the three months ended March 30, 2014 and March 31, 2013, conversion of stock options and non-vested shares totaling 216,648 and 3,938,761, respectively, into common share equivalents were excluded from this calculation as their effect would have been anti-dilutive.

13

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

7. Balance Sheet Information

Accounts Receivable. Customer accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for cash discounts, returns and bad debts is the Company's best estimate of the amount of uncollectible amounts in its existing accounts receivable. The Company determines the allowance based on historical discounts taken and write-off experience. The Company reviews its allowance for doubtful accounts quarterly. Account balances are charged off against the allowance when the Company concludes it is probable the receivable will not be recovered. The Company does not have any off-balance sheet credit exposure related to its customers. Accounts receivable are as follows:

	March 30, 2014			December 29, 2013
Customers	$	185,390		$	160,704
Allowances for cash discounts, bad debts and returns	(6,419		)	(5,849		)
Subtotal	178,971			154,855
Other receivables	6,626			9,809
Total	$	185,597		$	164,664

Inventories. Inventories are as follows:

	March 30, 2014		December 29, 2013
Raw materials, containers and supplies	$	69,815	$	53,779
Finished product	269,976		308,093
Total	$	339,791	$	361,872

The Company has various purchase commitments for raw materials, containers, supplies and certain finished products incident to the ordinary course of business. Such commitments are not at prices in excess of current market.

Other Current Assets. Other Current Assets are as follows:

	March 30, 2014		December 29, 2013
Prepaid expenses	$	5,879	$	5,560
Prepaid income taxes	937		776
Assets held for sale	1,556		1,556
Total	$	8,372	$	7,892

Assets held for sale is comprised of our closed plant in Millsboro, DE.

14

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Plant Assets. Plant assets are as follows:

	March 30, 2014			December 29, 2013
Land	$	14,061		$	14,061
Buildings	197,940			196,206
Machinery and equipment	589,817			576,156
Projects in progress	39,764			33,950
Subtotal	841,582			820,373
Accumulated depreciation	(311,830		)	(297,103		)
Total	$	529,752		$	523,270

Depreciation was $16,205 and $15,398 during the three months ended March 30, 2014 and March 31, 2013, respectively. As of March 30, 2014 and December 29, 2013, Machinery and equipment included assets under capital lease with a book value of $20,499 and $19,168 (net of accumulated depreciation of $10,203 and $9,425), respectively.

Accrued Liabilities. Accrued liabilities are as follows:

	March 30, 2014		December 29, 2013
Employee compensation and benefits	$	49,023	$	59,871
Interest payable	18,402		14,108
Consumer coupons	2,263		1,445
Accrued restructuring charges	1,761		1,938
Accrued financial instrument contracts (see Note 11)	40		768
Other	19,139		21,625
Total	$	90,628	$	99,755

Other Long-Term Liabilities. Other long-term liabilities are as follows:

	March 30, 2014		December 29, 2013
Employee compensation and benefits	$	9,249	$	8,434
Long-term rent liability and deferred rent allowances	9,167		9,401
Liability for uncertain tax positions	727		727
Accrued financial instrument contracts (see Note 11)	1,728		1,136
Other	4,664		4,862
Total	$	25,535	$	24,560

8. Goodwill, Tradenames and Other Assets

Goodwill

Goodwill by segment is as follows:

	Birds Eye Frozen		Duncan Hines Grocery		Specialty Foods		Total
Balance, December 29, 2013	$	527,069	$	927,065	$	173,961	$	1,628,095
Balance, March 30, 2014	$	527,069	$	927,065	$	173,961	$	1,628,095

15

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

The authoritative guidance for business combinations requires that all business combinations be accounted for at fair value under the acquisition method of accounting. The authoritative guidance for goodwill provides that goodwill will not be amortized, but will be tested for impairment on an annual basis or more often when events indicate. The Company completed its annual testing as of December 29, 2013, which indicated no impairment.

Tradenames

Tradenames by segment are as follows:

	Birds Eye		Duncan Hines		Specialty
	Frozen		Grocery		Foods		Total
Balance, December 29, 2013	$	796,680	$	1,118,712	$	36,000	$	1,951,392
Balance, March 30, 2014	$	796,680	$	1,118,712	$	36,000	$	1,951,392

The authoritative guidance for indefinite-lived assets provides that indefinite-lived assets will not be amortized, but will be tested for impairment on an annual basis or more often when events indicate. The Company completed its annual testing as of December 29, 2013, which indicated no impairment.

Other Assets

	March 30, 2014
	Weighted Avg Life	Gross Carrying Amount		Accumulated Amortization			Net
Amortizable intangibles
Recipes	10	$	52,810	$	(36,966	)	$	15,844
Customer relationships - Distributors	36	139,146		(36,034		)	103,112
Customer relationships - Food Service	7	36,143		(36,143		)	—
Customer relationships - Private Label	7	9,214		(9,214		)	—
License	7	6,175		(3,512		)	2,663
Total amortizable intangibles		$	243,488	$	(121,869	)	$	121,619
Deferred financing costs		46,805		(22,222		)	24,583
Financial instruments (see note 11)		21,389		—			21,389
Other (1)		6,361		—			6,361
Total other assets, net							$	173,952
	Amortizable intangibles by segment
	Birds Eye Frozen						$	61,803
	Duncan Hines Grocery						56,477
	Specialty Foods						3,339
							$	121,619

16

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

	December 29, 2013
	Weighted Avg Life	Gross Carrying Amount		Accumulated Amortization			Net
Amortizable intangibles
Recipes	10	$	52,810	$	(35,645	)	$	17,165
Customer relationships - Distributors	36	139,146		(34,518		)	104,628
Customer relationships - Food Service	7	36,143		(35,291		)	852
Customer relationships - Private Label	7	9,214		(9,078		)	136
License	7	6,175		(3,162		)	3,013
Total amortizable intangibles		$	243,488	$	(117,694	)	$	125,794
Deferred financing costs		46,638		(21,198		)	25,440
Financial instruments (see note 11)		29,518		—			29,518
Other (1)		5,373		—			5,373
Total other assets, net							$	186,125
	Amortizable intangibles by segment
	Birds Eye Frozen						$	63,319
	Duncan Hines Grocery						58,090
	Specialty Foods						4,385
							$	125,794

(1) As of March 30, 2014 and December 29, 2013, Other primarily consists of security deposits and supplemental savings plan investments.

Amortization of intangible assets was $4,175 and $3,872 for the three months ended March 30, 2014 and March 31, 2013, respectively. Estimated amortization expense for each of the next five years and thereafter is as follows: remainder of 2014 -$9,600; 2015 - $12,200; 2016 - $11,000; 2017 - $6,400; 2018 - $4,700 and thereafter - $77,700. As of March 30, 2014, Food Service and Private Label customer relationships were fully amortized.

Deferred Financing Costs

All deferred financing costs, which relate to the Senior Secured Credit Facility and Senior Notes are amortized into interest expense over the life of the related debt using the effective interest method. Amortization of deferred financing costs was $1,024 and $1,713 during the three months ended March 30, 2014 and March 31, 2013, respectively.

The following summarizes deferred financing cost activity:

	Gross Carrying Amount		Accumulated Amortization			Net
Balance, December 29, 2013	$	46,638	$	(21,198	)	$	25,440
2014 - Additions	167		—			167
Amortization	—		(1,024		)	(1,024		)
Balance, March 30, 2014	$	46,805	$	(22,222	)	$	24,583

17

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

9. Debt and Interest Expense

	March 30, 2014			December 29, 2013
Short-term borrowings
- Notes payable	$	2,419		$	2,437
Total short-term borrowings	$	2,419		$	2,437
Long-term debt
- Senior Secured Credit Facility - Tranche G Term Loans due 2020	1,617,775			1,621,850
- Senior Secured Credit Facility - Tranche H Term Loans due 2020	523,688			525,000
- 4.875% Senior Notes due 2021	350,000			350,000
- Unamortized discount on long term debt	(15,452		)	(16,085		)
- Capital lease obligations	19,589			19,982
	2,495,600			2,500,747
Less: current portion of long-term obligations	24,582			24,580
Total long-term debt	$	2,471,018		$	2,476,167

Interest expense	Three months ended
	March 30, 2014		March 31, 2013
Interest expense, third party	$	22,796	$	37,520
Related party interest expense (Note 13)	516		579
Amortization of debt acquisition costs (Note 8)	1,024		1,713
Interest rate swap losses (Note 11)	31		844
Total interest expense	$	24,367	$	40,656

Senior Secured Credit Facility

To partially fund the Wish-Bone Acquisition, on October 1, 2013 as described in Note 3, Pinnacle Foods Finance entered into an amendment to the Second Amended and Restated Credit Agreement (the “Amendment”) in the form of incremental term loans in the amount of $525.0 million (the “Tranche H Term Loans”). In connection with Tranche H Term Loans, Pinnacle Foods Finance incurred $8.5 million of original issue discount and deferred financing fees of $10.5 million.

On April 3, 2013, the Company completed its IPO which is further described in Note 1. A portion of the proceeds was used to redeem the entire $465.0 million in aggregate principal amount of Pinnacle Foods Finance's 9.25% Senior Notes at a redemption price of 100.0%. This is explained in greater detail under the section titled, “Senior Notes.” The remaining net proceeds, together with cash on hand, was used to repay $202.0 million of the Tranche B Non-Extended Term Loans.

On April 29, 2013, (the "April 2013 Refinancing"), Pinnacle Foods Finance, entered into the second amendment to the amended and restated Senior Secured Credit Facility, which provided for a seven year term loan facility in the amount of $1,630.0 million (the "Tranche G Term Loans") and replaced the existing revolving credit facility with a new five year $150.0 million revolving credit facility. Additionally, Pinnacle Foods Finance issued $350.0 million aggregate principal amount of 4.875% Senior Notes (the "4.875% Senior Notes") due 2021.

As a result of the April 2013 Refinancing, Pinnacle Foods Finance used a portion of the proceeds from the Tranche G Term Loans and the 4.875% Senior Notes issuance to (i) repay all existing indebtedness outstanding under the then existing Senior Secured Credit Facility, consisting of (a) $38.1 million of Tranche B Non-Extended Term Loans, (b) $634.7 million of Tranche B Extended Term Loans, (c) $396.0 million of Tranche E Term Loans and (d) $446.6 million of Tranche F Term Loans and (ii) redeem $400.0 million in aggregate principal amount of Pinnacle Foods Finance's 8.25% Senior Notes due 2017 at a redemption price of 108.5%.

18

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

The stated maturity dates are: April 29, 2020 for the Tranche G Loans and the Tranche H Term Loans, and April 29, 2018 for the revolving credit facility.

Pinnacle Foods Finance's borrowings under the Senior Secured Credit Facility, bear interest at a floating rate and are maintained as base rate loans or as eurocurrency rate loans. Base rate loans bear interest at the base rate plus the applicable base rate margin, as described in the Senior Secured Credit Facility. The base rate is defined as the highest of (i) the administrative agent's prime rate, (ii) the federal funds effective rate plus 1/2 of 1% and (iii) the eurocurrency rate that would be payable on such day for a eurocurrency rate loan with a one-month interest period plus 1%. Eurocurrency rate loans bear interest at the adjusted eurocurrency rate plus the applicable eurocurrency rate margin, as described in the Senior Secured Credit Facility. The eurocurrency rate is determined by reference to the British Bankers Association "BBA" LIBOR rate for the interest period relevant to such borrowing. With respect to Tranche G Term Loans and Tranche H Term Loans, the eurocurrency rate shall be no less than 0.75% per annum and the base rate shall be no less than 1.75%  per annum. The interest rate margin for Tranche G Term Loans and Tranche H Term Loans under the Senior Secured Credit Facility is 1.50%, in the case of the base rate loans and 2.50%, in the case of eurocurrency rate loans. The margin is subject to a 25 basis point step down upon achievement by Pinnacle Foods Finance of a total net leverage ratio of less than 4.25:1.0.

The obligations under the Senior Secured Credit Facility are unconditionally and irrevocably guaranteed by Peak Finance Holdings LLC, any subsidiary of Peak Finance Holdings LLC that directly or indirectly owns 100% of the issued and outstanding equity interests of Pinnacle Foods Finance, subject to certain exceptions, each of Pinnacle Foods Finance’s direct or indirect material wholly-owned domestic subsidiaries (collectively, the “Guarantors”) and by the Company effective with the April 2013 refinancing. In addition, subject to certain exceptions and qualifications, borrowings under the Senior Secured Credit Facility are secured by first priority or equivalent security interests in (i) all the capital stock of, or other equity interests in, each direct or indirect domestic material subsidiary of Pinnacle Foods Finance and 65% of the capital stock of, or other equity interests in, each direct material "first tier" foreign subsidiary of Pinnacle Foods Finance and (ii) certain tangible and intangible assets of Pinnacle Foods Finance and those of the Guarantors (subject to certain exceptions and qualifications).

The total combined amount of the Senior Secured Credit Facility Loans that were owed to affiliates of Blackstone as of March 30, 2014 and December 29, 2013, was $63,889 and $63,796, respectively.

A commitment fee of 0.375% per annum based on current leverage ratios is applied to the unused portion of the revolving credit facility. There were no revolver borrowings made during fiscal 2013 or 2014, except in respect of letters of credit as set forth below. As of March 30, 2014 and December 29, 2013, the eurocurrency rate would have been 2.65% and 2.67% as of such dates. For the three months ended March 30, 2014 and March 31, 2013, the weighted average interest rate on the term loan components of the Senior Secured Credit Facility was 3.25% and 4.08%, respectively. As of March 30, 2014 and December 29, 2013 the eurocurrency interest rate on the term loan facilities was 3.25% and 3.25%, respectively.

Pinnacle Foods Finance pays a fee for all outstanding letters of credit drawn against the revolving credit facility at an annual rate equivalent to the applicable eurocurrency rate margin then in effect under the revolving credit facility, plus the fronting fee payable in respect of the applicable letter of credit. The fronting fee is equal to 0.125% per annum of the daily maximum amount then available to be drawn under such letter of credit. The fronting fees are computed on a quarterly basis in arrears. Total letters of credit issued under the revolving credit facility cannot exceed $50,000. As of March 30, 2014 and December 29, 2013, Pinnacle Foods Finance had utilized $31,566 and $32,923, respectively of the revolving credit facility for letters of credit. As of March 30, 2014 and December 29, 2013, respectively, there was $118,434 and $117,077 of borrowing capacity under the revolving credit facility, of which $18,434 and $17,077 was available to be used for letters of credit.

Under the terms of the Senior Secured Credit Facility, Pinnacle Foods Finance is required to use 50% of its “Excess Cash Flow” to prepay the term loans under the Senior Secured Credit Facility (which percentage will be reduced to 25% at a total net leverage ratio of between 4.50 and 5.49 and to 0% at a total net leverage ratio below 4.50). As of March 30, 2014, Pinnacle Foods Finance had a total net leverage ratio of 4.61 (proforma adjusted for the Wish-Bone acquisition in compliance with the terms of the Senior Secured Credit Facility). Excess Cash Flow is defined as consolidated net income (as defined), as adjusted for certain items, including (1) all non-cash charges and credits included in arriving at consolidated net income, (2) changes in working capital, (3) capital expenditures (to the extent they were not financed with debt), (4) the aggregate amount of principal payments on indebtedness and (5) certain other items defined in the Senior Secured Credit Facility. For the 2013 reporting year, Pinnacle Foods Finance determined that there were no amounts due under the Excess Cash Flow requirements of the Senior Secured Credit Facility. In December 2014, Pinnacle Foods Finance will determine if amounts are due under the Excess Cash Flow requirements of the Senior Secured Credit Facility for the 2014 reporting year.

19

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

The term loans under the Senior Secured Credit Facility amortize in quarterly installments of 0.25% of their aggregate funded total principal amount. The scheduled principal payments of the Tranche G Term Loans outstanding as of March 30, 2014 are $12.2 million in the remainder of 2014, $16.3 million in 2015, $16.3 million in 2016, $20.4 million in 2017, $12.2 million in 2018 and $1,540.4 million thereafter. The scheduled principal payments of the Tranche H Term Loans outstanding as of March 30, 2014 are $3.9 million in the remainder of 2014, $5.3 million in 2015, $5.3 million in 2016, $6.6 million in 2017, $3.9 million in 2018 and $498.7 million thereafter.

Pursuant to the terms of the Senior Secured Credit Facility, Pinnacle Foods Finance is required to maintain a ratio of Net First Lien Secured Debt to Covenant Compliance EBITDA of no greater than 5.75 to 1.00. Net First Lien Secured Debt is defined as aggregate consolidated secured indebtedness, less the aggregate amount of all unrestricted cash and cash equivalents. In addition, under the Senior Secured Credit Facility and the indenture governing the Senior Notes, Pinnacle Foods Finance's ability to engage in activities such as incurring additional indebtedness, making investments and paying dividends is tied to the Senior Secured Leverage Ratio (which is currently the same as the ratio of Net First Lien Secured Debt to Covenant Compliance EBITDA described above), in the case of the Senior Secured Credit Facility, or to the ratio of Covenant Compliance EBITDA to fixed charges for the most recently concluded four consecutive fiscal quarters, in the case of the Senior Notes. The Senior Secured Credit Facility also permits restricted payments up to an aggregate amount of (together with certain other amounts) the greater of $50 million and 2% of Pinnacle Foods Finance's consolidated total assets, so long as no default has occurred and is continuing and its pro forma Senior Secured Leverage Ratio would be no greater than 4.25 to 1.00. As of March 30, 2014 the Company is in compliance with all covenants and other obligations under the Senior Secured Credit Facility and the indenture governing the Senior Notes.

Senior Notes

On April 3, 2013, the Company completed its IPO which is further described in Note 1. A portion of the proceeds was used to redeem the entire $465.0 million in aggregate principal amount of Pinnacle Foods Finance's 9.25% Senior Notes at a redemption price of 100.0%.

On April 29, 2013, as part of the April 2013 Refinancing, Pinnacle Foods Finance, an indirect subsidiary of the Company, issued $350.0 million aggregate principal amount of 4.875% Senior Notes (the "4.875% Senior Notes") due 2021.

As a result of the April 2013 Refinancing, Pinnacle Foods Finance used a portion of the proceeds from the Tranche G Term Loans and the 4.875% Senior Notes issuance to redeem $400.0 million in aggregate principal amount of Pinnacle Foods Finance's 8.25% Senior Notes due 2017 at a redemption price of 108.5%.

The 4.875% Senior Notes are general senior unsecured obligations of Pinnacle Foods Finance, effectively subordinated in right of payment to all existing and future senior secured indebtedness of Pinnacle Foods Finance and guaranteed on a full, unconditional, joint and several basis by Pinnacle Foods Finance’s wholly-owned domestic subsidiaries that guarantee other indebtedness of Pinnacle Foods Finance. See Note 16 for the condensed Consolidated Financial Statements for Guarantor and Nonguarantor Financial Statements.

Pinnacle Foods Finance may redeem some or all of the 4.875% Senior Notes at any time prior to May 1, 2016 at a price equal to 100% of the principal amount of notes redeemed plus the Applicable Premium as of, and accrued and unpaid interest to, the redemption date, subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date. The “Applicable Premium” is defined as the greater of (1) 1.0% of the principal amount of such note and (2) the excess, if any, of (a) the present value at such redemption date of (i) the redemption price of such 4.875% Senior Notes at May 1, 2016, plus (ii) all required interest payments due on such 4.875% Senior Notes through May 1, 2016 (excluding accrued but unpaid interest to the redemption date), computed using a discount rate equal to the treasury rate plus 50 basis points over (b) the principal amount of such note.

20

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Pinnacle Foods Finance may redeem the 4.875% Senior Notes at the redemption prices listed below, if redeemed during the twelve-month period beginning on May 1^st of each of the years indicated below:

4.875% Senior Notes
Year	Percentage
2016	103.656%
2017	102.438%
2018	101.219%
2019 and thereafter	100.000%

In addition, until May 1, 2016, Pinnacle Foods Finance may redeem up to 35% of the aggregate principal amount of the 4.875% Senior Notes at a redemption price equal to 104.875% of the aggregate principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, subject to the right of holders of the 4.875% Senior Notes of record on the relevant record date to receive interest due on the relevant interest payment date, with the net cash proceeds received by Pinnacle Foods Finance from one or more equity offerings; provided that (i) at least 50% of the aggregate principal amount of the 4.875% Senior Notes originally issued under the indenture remains outstanding immediately after the occurrence of each such redemption and (ii) each such redemption occurs within 120 days of the date of closing of each such equity offering.

As market conditions warrant, Pinnacle Foods Finance and its subsidiaries, affiliates or significant equity holders (including Blackstone and its affiliates) may from time to time, in its or their sole discretion, purchase, repay, redeem or retire any of Pinnacle Foods Finance’s outstanding debt or equity securities (including any publicly issued debt or equity securities), in privately negotiated or open market transactions, by tender offer, exchange offer or otherwise.

The estimated fair value of the Company’s long-term debt, including the current portion, as of March 30, 2014, is as follows:

	March 30, 2014
Issue	Face Value		Fair Value
Senior Secured Credit Facility - Tranche G Term Loans	1,617,775		1,609,686
Senior Secured Credit Facility - Tranche H Term Loans	523,688		519,760
4.875% Senior Notes	350,000		341,250
	$	2,491,463	$	2,470,696

The estimated fair value of the Company’s long-term debt, including the current portion, as of December 29, 2013, is as follows:

	December 29, 2013
Issue	Face Value		Fair Value
Senior Secured Credit Facility - Tranche G Term Loans	1,621,850		1,619,823
Senior Secured Credit Facility - Tranche H Term Loans	525,000		524,344
4.875% Senior Notes	350,000		329,000
	$	2,496,850	$	2,473,167

The estimated fair values of the Company's long-term debt are classified as Level 2 in the fair value hierarchy. The fair value is based on the quoted market price for such notes and borrowing rates currently available to the Company for loans with similar terms and maturities.

21

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

10. Pension and Retirement Plans

The Company accounts for pension and retirement plans in accordance with the authoritative guidance for retirement benefit compensation. This guidance requires recognition of the funded status of a benefit plan in the statement of financial position. The guidance also requires recognition in accumulated other comprehensive earnings of certain gains and losses that arise during the period but are deferred under pension accounting rules.

The Company uses a measurement date for the pension benefit plan that coincides with its year end.

On December 31, 2013, the Pinnacle Foods Pension Plan merged into the Birds Eye Foods Pension Plan in order to achieve administrative, operational and cost efficiencies. The merged plan was renamed the Pinnacle Foods Group LLC Pension Plan (the "PFG Plan"). The Company has one defined benefit plan which is frozen for future benefit accruals, two qualified 401(k) plans, two non-qualified supplemental savings plans and participates in a multi-employer defined benefit plan.

Pinnacle Foods Group LLC Pension Plan

The Company maintains a non-contributory defined benefit pension plan that covers eligible union employees and provides benefits generally based on years of service and employees’ compensation. The plan is frozen for future benefits. The PFG Plan is funded in conformity with the funding requirements of applicable government regulations. Plan assets consist principally of cash equivalents, equity and fixed income common collective trusts. Plan assets do not include any of the Company’s own equity or debt securities.

The following represents the components of net periodic (benefit) cost:

	PFG Plan
	Three months ended
Pension Benefits	March 30, 2014			March 31, 2013
Interest cost	2,902			2,839
Expected return on assets	(3,292		)	(3,374		)
Amortization of:
Actuarial loss	32			456
Net periodic benefit	$	(358	)	$	(79	)

Cash Flows

Contributions. In fiscal 2014, the Company expects to make contributions of $10.5 million to the PFG Plan, of which minimum required payments of $2.1 million were made in the three months ended March 30, 2014. The Company made contributions to the pension plan totaling $8.3 million in fiscal 2013, of which $0.3 million were made in the three months ended March 31, 2013.

Multi-employer Plans

Pinnacle contributes to the United Food and Commercial Workers International Union Industry Pension Fund (EIN 51-6055922) (the "UFCW Plan") under the terms of the collective-bargaining agreement with its Fort Madison employees.

For the three months ended March 30, 2014 and March 31, 2013, contributions to the UFCW Plan were $193 and $189, respectively. The contributions to this plan are paid monthly based upon the number of employees. They represent less than 5% of the total contributions received by this plan during the most recent plan year.

The risks of participating in multi-employer plans are different from single-employer plans in the following aspects: (a) assets contributed to a multi-employer plan by one employer may be used to provide benefits to employees of other participating employers, (b) if a participating employer stops contributing to the multi-employer plan, the unfunded obligations of the plan may be borne by the remaining participating employers and (c) if the Company chooses to stop participating in the plan, the Company may be required to pay a withdrawal liability based on the underfunded status of the plan.

The UFCW Plan received a Pension Protection Act “green” zone status for the plan year ending June 30, 2013. The zone status is based on information the Company received from the plan and is certified by the plan's actuary. Among other factors, plans in

22

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

the green zone are at least 80 percent funded. The UFCW Plan did not utilize any extended amortization provisions that effect its placement in the "green" zone. The UFCW Plan has never been required to implement a funding improvement plan nor is one pending at this time.

11. Financial Instruments

Risk Management Objective of Using Derivatives

The Company is exposed to certain risks arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of its debt funding and the use of derivative financial instruments. The primary risks managed by using derivative instruments are interest rate risk, foreign currency exchange risk and commodity price risk. Specifically, the Company enters into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates, foreign exchange rates or commodity prices.

The Company manages interest rate risk based on the varying circumstances of anticipated borrowings and existing variable and fixed rate debt, including the Company’s revolving credit facility. Examples of interest rate management strategies include capping interest rates using targeted interest cost benchmarks, hedging portions of the total amount of debt, or hedging a period of months and not always hedging to maturity, and at other times locking in rates to fix interests costs.

Certain parts of the Company’s foreign operations in Canada expose the Company to fluctuations in foreign exchange rates. The Company’s goal is to reduce its exposure to such foreign exchange risks on its foreign currency cash flows and fair value fluctuations on recognized foreign currency denominated assets, liabilities and unrecognized firm commitments to acceptable levels primarily through the use of foreign exchange-related derivative financial instruments. The Company enters into derivative financial instruments to protect the value or fix the amount of certain obligations in terms of its functional currency. The Company does not enter into these transactions for non-hedging purposes.

The Company purchases raw materials in quantities expected to be used in a reasonable period of time in the normal course of business. The Company generally enters into agreements for either spot market delivery or forward delivery. The prices paid in the forward delivery contracts are generally fixed, but may also be variable within a capped or collared price range. Forward derivative contracts on certain commodities are entered into to manage the price risk associated with forecasted purchases of materials used in the Company’s manufacturing processes.

Cash Flow Hedges of Interest Rate Risk

The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company primarily uses interest rate swaps. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. During the three months ended March 30, 2014 and March 31, 2013, such derivatives were used to hedge the variable cash flows associated with existing variable-rate debt.

As of March 30, 2014, the Company had the following interest rate swaps that were designated as cash flow hedges of interest rate risk:

Product	Number of Instruments	Current Notional Amount		Fixed Rate Range	Index	Trade Dates	Maturity Dates
Interest Rate Swaps	18	$	1,643,000	0.76% - 2.97%	USD-LIBOR-BBA	April 2013 - October 2013	April 2014 - April 2020

The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in Accumulated other comprehensive loss (“AOCL”) in the Consolidated Balance Sheets and is subsequently reclassified into earnings

23

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

in the period that the hedged forecasted transaction affects earnings. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. Amounts reported in AOCL related to derivatives will be reclassified to Interest expense as interest payments are made on the Company’s variable-rate debt. During the next twelve months, the Company estimates that an additional $1,323 will be reclassified as an increase to Interest expense.

Cash Flow Hedges of Foreign Exchange Risk

The Company’s operations in Canada expose the Company to changes in the U.S. Dollar – Canadian Dollar ("USD-CAD") foreign exchange rate. From time to time, the Company’s Canadian subsidiary purchases inventory denominated in U.S. Dollars ("USD"), a currency other than its functional currency. The subsidiary sells that inventory in Canadian dollars. The subsidiary uses currency forward and collar agreements to manage its exposure to fluctuations in the USD-CAD exchange rate. Currency forward agreements involve fixing the USD-CAD exchange rate for delivery of a specified amount of foreign currency on a specified date. Currency collar agreements involve the sale of Canadian Dollar ("CAD") currency in exchange for receiving U.S. dollars if exchange rates rise above an agreed upon rate and purchase of USD currency in exchange for paying CAD currency if exchange rates fall below an agreed upon rate at specified dates.

As of March 30, 2014, the Company had the following foreign currency exchange contracts (in aggregate) that were designated as cash flow hedges of foreign exchange risk:

Product	Number of Instruments	Notional Sold in Aggregate in ("CAD")		Notional Purchased in Aggregate in ("USD")		USD to CAD Exchange Rates	Trade Date	Maturity Dates
CAD Forward	9	$	29,200	$	27,206	1.071 - 1.077	Dec 2013	May 2014 - December 2014

The effective portion of changes in the fair value of derivatives designated that qualify as cash flow hedges of foreign exchange risk is recorded in AOCL in the Consolidated Balance Sheets and subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. The ineffective portions of the change in fair value of the derivative, as well as amounts excluded from the assessment of hedge effectiveness, are recognized directly in Cost of products sold in the Consolidated Statements of Operations.

Non-designated Hedges of Commodity Risk

Derivatives not designated as hedges are not speculative and are used to manage the Company’s exposure to commodity price risk but do not meet the authoritative guidance for hedge accounting. From time to time, the Company enters into commodity forward contracts to fix the price of natural gas, diesel fuel, corn, wheat and soybean oil purchases and other commodities at a future delivery date. Changes in the fair value of derivatives not designated in hedging relationships are recorded directly in Cost of products sold in the Consolidated Statements of Operations.

24

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

As of March 30, 2014, the Company had the following derivative instruments that were not designated in qualifying hedging relationships:

Commodity Contracts	Number of Instruments	Notional Amount	Price/Index	Trade Dates	Maturity Dates
Diesel Fuel Contracts	7	3,349,496 Gallons	$3.85 - $3.90 per Gallon	October 2013 - Nov 2013	April 2014 - December 2014

The table below presents the fair value of the Company’s derivative financial instruments as well as their classification in the Consolidated Balance Sheets as of March 30, 2014 and December 29, 2013.

	Tabular Disclosure of Fair Values of Derivative Instruments
	Asset Derivatives			Liability Derivatives
	Balance Sheet Location	Fair Value as of March 30, 2014		Balance Sheet Location	Fair Value as of March 30, 2014
Derivatives designated as hedging instruments
Interest Rate Contracts	Other assets, net	$	21,389	Accrued liabilities	$	40
				Other long-term liabilities	1,728
Foreign Exchange Contracts	Other current assets	888
Total derivatives designated as hedging instruments		$	22,277		$	1,768
Derivatives not designated as hedging instruments
Commodity Contracts	Other current assets	$	118
Total derivatives not designated as hedging instruments		$	118		$	—
	Balance Sheet Location	Fair Value as of December 29, 2013		Balance Sheet Location	Fair Value as of December 29, 2013
Derivatives designated as hedging instruments
Interest Rate Contracts				Accrued liabilities	$	70
	Other assets, net	$	29,518	Other long-term liabilities	1,136
Foreign Exchange Contracts	Other current assets	307
Total derivatives designated as hedging instruments		$	29,825		$	1,206
Derivatives not designated as hedging instruments
Interest Rate Contracts				Accrued liabilities	$	698
Commodity Contracts	Other current assets	$	543
Total derivatives not designated as hedging instruments		$	543		$	698

25

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

The table below presents the effect of the Company’s derivative financial instruments in the Consolidated Statements of Operations and Accumulated other comprehensive loss ("AOCL") for the three months ended March 30, 2014 and March 31, 2013.

Tabular Disclosure of the Effect of Derivative Instruments

Gain/(Loss)
Derivatives in Cash Flow Hedging Relationships	Recognized in AOCL on Derivative (Effective Portion)			Effective portion reclassified from AOCL to:	Reclassified from AOCL into Earnings (Effective Portion)			Ineffective portion recognized in Earnings in:	Recognized in Earnings on Derivative (Ineffective Portion)
Interest Rate Contracts	$	(8,732	)	Interest expense	$	(41	)	Interest expense	$	—
Foreign Exchange Contracts	991			Cost of products sold	413			Cost of products sold	3
Three months ended March 30, 2014	$	(7,741	)		$	372			$	3
Interest Rate Contracts	$	(132	)	Interest expense	$	(854	)	Interest expense	$	10
Foreign Exchange Contracts	736			Cost of products sold	192			Cost of products sold	—
Three months ended March 31, 2013	$	604			$	(662	)		$	10
Derivatives Not Designated as Hedging Instruments				Recognized in Earnings in:	Recognized in Earnings on Derivative
Commodity Contracts				Cost of products sold	$	(354	)
Interest Rate Contracts				Interest expense	11
Three months ended March 30, 2014					$	(343	)
Commodity Contracts				Cost of products sold	$	205
Three months ended March 31, 2013					$	205

Credit risk-related contingent features

The Company has agreements with certain counterparties that contain a provision whereby the Company could be declared in default on its derivative obligations if repayment of the underlying indebtedness is accelerated by the lender due to the Company’s default on the indebtedness. As of March 30, 2014, the Company has not posted any collateral related to these agreements. If the Company had breached this provision at March 30, 2014, it could have been required to settle its obligations under the agreements at their termination value, which differs from the recorded fair value. The table below summarizes the aggregate fair values of those derivatives that contain credit risk-related contingent features as of March 30, 2014 and December 29, 2013.

March 30, 2014

Asset/(Liability)
Counterparty	Contract Type	Termination Value			Performance Risk Adjustment		Accrued Interest			Fair Value (excluding interest)
Barclays	Interest Rate Contracts	$	8,563		$	231	$	(11	)	$	8,805
	Commodity Contracts	118			—		—			118
Bank of America	Interest Rate Contracts	8,555			259		—			8,814
Credit Suisse	Interest Rate Contracts	2,352			64		(11		)	2,427
	Foreign Exchange Contracts	887			1		—			888
Macquarie	Interest Rate Contracts	(745		)	85		(3		)	(657		)
Total		$	19,730		$	640	$	(25	)	$	20,395

26

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

December 29, 2013

Asset/(Liability)
Counterparty	Contract Type	Termination Value			Performance Risk Adjustment			Accrued Interest			Fair Value (excluding interest)
Barclays	Interest Rate Contracts	$	12,303		$	(12	)	$	(155	)	$	12,446
	Commodity Contracts	543			—			—			543
Bank of America	Interest Rate Contracts	12,930			(124		)	—			12,806
Credit Suisse	Interest Rate Contracts	2,634			62			(75		)	2,771
	Foreign Exchange Contracts	300			6			—			306
Macquarie	Interest Rate Contracts	(506		)	93			(3		)	(410		)
Total		$	28,204		$	25		$	(233	)	$	28,462

12. Commitments and Contingencies

General

From time to time, the Company and its operations are parties to, or targets of, lawsuits, claims, investigations, and proceedings, which are being handled and defended in the ordinary course of business. Although the outcome of such items cannot be determined with certainty, the Company’s general counsel and management are of the opinion that the final outcome of these matters will not have a material effect on the Company’s financial condition, results of operations or cash flows.

No single item individually is, nor are all of them in the aggregate, material.

13. Related Party Transactions

At the closing of its acquisition by Blackstone, the Company entered into an advisory agreement with an affiliate of Blackstone pursuant to which such entity or its affiliates provided certain strategic and structuring advice and assistance to the Company. In addition, under this agreement, affiliates of Blackstone provided certain monitoring, advisory and consulting services to the Company for an aggregate annual management fee equal to the greater of $2,500 or 1.0% of Covenant Compliance EBITDA (as defined in the credit agreement governing the Company’s Senior Secured Credit Facility). Expenses relating to the management fee were $1,148 in the three months ended March 31, 2013.

On April 3, 2013, the advisory agreement was terminated in accordance with its terms for a fee paid of $15,100. In addition, prepaid expenses for related party management fees of $3,345 that were recorded to Other current assets were expensed in the second quarter of 2013.

Customer Purchases

Performance Food Group Company, which is controlled by affiliates of Blackstone, is a foodservice supplier that purchases products from the Company. Sales to Performance Food Group Company were $1,075 and $1,144 in the three months ended March 30, 2014 and March 31, 2013, respectively. As of March 30, 2014 and December 29, 2013, amounts due from Performance Food Group Company were $110 and $57, respectively, and were recorded on the Accounts receivable, net of allowances line in the Consolidated Balance Sheets.

Interest Expense

For the three months ended March 30, 2014 and March 31, 2013, fees and interest expense recognized in the Consolidated Statements of Operations for debt owed to affiliates of Blackstone Advisors L.P. totaled $516 and $579, respectively. As of March 30, 2014 and December 29, 2013, debt owed to related parties was $63,889 and $63,796, respectively and was recorded on the Long-term debt line in the Consolidated Balance Sheets. As of March 30, 2014 and December 29, 2013, interest accrued on debt owed to related parties was $310 and $319, respectively, and was recorded on the Accrued liabilities line in the Consolidated Balance Sheets.

27

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

14. Segments

The Company is a leading manufacturer, marketer and distributor of high quality, branded food products in North America. The Company manages the business in three operating segments: Birds Eye Frozen, Duncan Hines Grocery and Specialty Foods.

The Birds Eye Frozen Division manages its Leadership Brands in the United States retail frozen vegetables (Birds Eye), frozen complete bagged meals (Birds Eye Voila!), and frozen seafood (Van de Kamp's and Mrs. Paul's) categories, as well as its Foundation Brands in the frozen and refrigerated bagels (Lender's), frozen pizza for one (Celeste), full-calorie single-serve frozen dinners and entrées (Hungry-Man), and frozen breakfast (Aunt Jemima) categories.

The Duncan Hines Grocery Division manages its Leadership Brands in the baking mixes and frostings (Duncan Hines), liquid and dry-mix salad dressings (Wish-Bone and Western), shelf-stable pickles (Vlasic), and table syrups (Mrs. Butterworth's and Log Cabin) categories, and its Foundation Brands in the canned meat (Armour, Nalley and Brooks), pie and pastry fillings (Duncan Hines Comstock and Wilderness), barbecue sauces (Open Pit) and salad dressing (Bernstein's) categories as well as all Canadian operations.

The Company refers to the sum of the Birds Eye Frozen Division and the Duncan Hines Grocery Division as the North America Retail businesses.

The Specialty Foods Division consists of snack products (Tim's Cascade and Snyder of Berlin) and foodservice and private label businesses.

Segment performance is evaluated by the Company’s Chief Operating Decision Maker and is based on earnings before interest and taxes. Transfers between segments and geographic areas are recorded at cost plus markup or at market. Identifiable assets are those assets, including goodwill, which are identified with the operations in each segment or geographic region. Corporate assets consist of prepaid and deferred tax assets. Unallocated corporate expenses consist of corporate overhead such as executive management, finance and legal functions and IPO and refinancing related charges.

28

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

	Three months ended
SEGMENT INFORMATION	March 30, 2014			March 31, 2013
Net sales
Birds Eye Frozen	$	294,278		$	292,451
Duncan Hines Grocery	264,904			227,208
Specialty Foods	84,857			93,322
Total	$	644,039		$	612,981
Earnings before interest and taxes
Birds Eye Frozen	$	46,728		$	48,926
Duncan Hines Grocery	42,673			29,432
Specialty Foods	7,072			8,186
Unallocated corporate expenses	(6,382		)	(5,873		)
Total	$	90,091		$	80,671
Depreciation and amortization
Birds Eye Frozen	$	9,949		$	9,288
Duncan Hines Grocery	6,462			5,827
Specialty Foods	3,969			4,155
Total	$	20,380		$	19,270
Capital expenditures (1)
Birds Eye Frozen	$	5,981		$	10,110
Duncan Hines Grocery	14,740			10,609
Specialty Foods	1,967			2,191
Total	$	22,688		$	22,910
NET SALES BY PRODUCT TYPE
Net sales
Frozen	$	337,234		$	338,025
Meals and Meal Enhancers (2)	210,700			174,489
Desserts	70,720			75,958
Snacks	25,385			24,509
Total	$	644,039		$	612,981
GEOGRAPHIC INFORMATION
Net sales
United States	$	639,817		$	606,581
Canada	20,191			20,616
Intercompany	(15,969		)	(14,216		)
Total	$	644,039		$	612,981

(1) Includes new capital leases.

(2) The Wish-Bone and Western salad dressing business was acquired on October 1, 2013 and will add approximately $190 million of annual sales to Meals & Meal Enhancers.

29

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

SEGMENT INFORMATION	March 30, 2014		December 29, 2013
Total assets
Birds Eye Frozen	$	2,026,286	$	2,004,250
Duncan Hines Grocery	2,588,187		2,577,093
Specialty Foods	359,777		358,198
Corporate	146,612		141,650
Total	$	5,120,862	$	5,081,191
GEOGRAPHIC INFORMATION
Long-lived assets
United States	$	529,728	$	523,250
Canada	24		20
Total	$	529,752	$	523,270

15. Provision for Income Taxes

The provision for income taxes and related effective tax rates for the three months ended March 30, 2014 and March 31, 2013, respectively, were as follows:

	Three months ended
Provision for Income Taxes	March 30, 2014			March 31, 2013
Current	$	650		$	720
Deferred	24,352			14,502
Total	$	25,002		$	15,222
Effective tax rate	38.0		%	38.0		%

Income taxes are accounted for in accordance with the authoritative guidance for accounting for income taxes under which deferred tax assets and liabilities are determined based on the difference between their financial statement basis and tax basis, using enacted tax rates in effect for the year in which the differences are expected to reverse.

During the three months ended March 30, 2014, state legislation was enacted which resulted in a benefit of $0.6 million to the provision for income taxes. During the three months ended March 31, 2013, the American Taxpayer Relief Act reinstated certain tax credits which resulted in a benefit of $0.4 million to the provision for income taxes.

The Company regularly evaluates its deferred tax assets for future realization.  A valuation allowance is established when the Company believes that it is more likely than not that some portion of its deferred tax assets will not be realized.  Changes in valuation allowances from period to period are included in the Company's tax provision in the period of change.

As of March 30, 2014 and March 31, 2013, the Company maintained a valuation allowance for certain state net operating loss (“NOL”) carryovers, state tax credit carryovers and foreign loss carryovers. There was no change in the valuation allowance for either of the three month reporting periods ended March 30, 2014 and March 31, 2013.

On September 13, 2013 the IRS issued final and proposed Tangible Property Regulations. The final regulations are generally effective for taxable years beginning on or after January 1, 2014. The adoption of the final regulations did not result in a material impact on the Company.

30

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

16. Guarantor and Nonguarantor Statements

The 4.875% Senior Notes are general senior unsecured obligations of Pinnacle Foods Finance, effectively subordinated in right of payment to all existing and future senior secured indebtedness of Pinnacle Foods Finance and guaranteed on a full, unconditional, joint and several basis by the Company and Pinnacle Foods Finance's 100% owned domestic subsidiaries that guarantee other indebtedness of the Company.

The following condensed consolidating financial information presents:

(1) (a) Condensed consolidating balance sheets as of March 30, 2014 and December 29, 2013.

(b) The related condensed consolidating statements of operations and comprehensive earnings for the Company, Pinnacle Foods Finance, all guarantor subsidiaries and the non-guarantor subsidiaries for the following:

i. Three months ended March 30, 2014; and

ii. Three months ended March 31, 2013.

(c) The related condensed consolidating statements of cash flows for the Company, Pinnacle Foods Finance, all guarantor subsidiaries and the non-guarantor subsidiaries for the following:

i. Three months endedMarch 30, 2014; and

ii. Three months endedMarch 31, 2013.

(2) Elimination entries necessary to consolidate the Company, Pinnacle Foods Finance with its guarantor subsidiaries and non-guarantor subsidiaries.

Investments in subsidiaries are accounted for by the parent using the equity method of accounting. The guarantor subsidiaries are presented on a combined basis. The principal elimination entries eliminate investments in subsidiaries and intercompany balances and transactions and include a reclassification entry of net non-current deferred tax assets to non-current deferred tax liabilities.

31

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Pinnacle Foods Inc. Condensed Consolidating Balance Sheet March 30, 2014
	Pinnacle Foods Inc.			Pinnacle Foods Finance LLC			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations and Reclassifications			Consolidated Total
Current assets:
Cash and cash equivalents	$	—		$	—		$	146,056		$	11,980		$	—		$	158,036
Accounts receivable, net	—			—			176,773			8,824			—			185,597
Intercompany accounts receivable	25,415			—			239,526			—			(264,941		)	—
Inventories, net	—			—			334,158			5,633			—			339,791
Other current assets	—			1,006			6,932			434			—			8,372
Deferred tax assets	—			—			145,676			199			—			145,875
Total current assets	25,415			1,006			1,049,121			27,070			(264,941		)	837,671
Plant assets, net	—			—			529,728			24			—			529,752
Investment in subsidiaries	1,611,270			2,073,913			11,420			—			(3,696,603		)	—
Intercompany note receivable	—			2,001,830			7,270			9,800			(2,018,900		)	—
Tradenames	—			—			1,951,392			—			—			1,951,392
Other assets, net	—			45,567			128,261			124			—			173,952
Deferred tax assets	—			288,176			—			—			(288,176		)	—
Goodwill	—			—			1,628,095			—			—			1,628,095
Total assets	$	1,636,685		$	4,410,492		$	5,305,287		$	37,018		$	(6,268,620	)	$	5,120,862
Current liabilities:
Short-term borrowings	$	—		$	—		$	2,419		$	—		$	—		$	2,419
Current portion of long-term obligations	—			21,550			3,032			—			—			24,582
Accounts payable	—			—			154,105			1,664			—			155,769
Intercompany accounts payable	—			256,271			—			8,670			(264,941		)	—
Accrued trade marketing expense	—			—			35,981			4,115			—			40,096
Accrued liabilities	—			18,843			71,475			310			—			90,628
Dividends payable	25,415			—			—			—			—			25,415
Total current liabilities	25,415			296,664			267,012			14,759			(264,941		)	338,909
Long-term debt	—			2,454,461			16,557			—			—			2,471,018
Intercompany note payable	—			—			2,010,967			7,933			(2,018,900		)	—
Pension and other postretirement benefits	—			—			47,154			—			—			47,154
Other long-term liabilities	—			1,728			21,077			2,730			—			25,535
Deferred tax liabilities	—			46,369			868,607			176			(288,176		)	626,976
Total liabilities	25,415			2,799,222			3,231,374			25,598			(2,572,017		)	3,509,592
Commitments and contingencies (Note 12)
Shareholder’s equity:
Pinnacle common stock	1,172			—			—			—			—			1,172
Additional paid-in-capital	1,331,032			1,332,204			1,285,084			2,324			(2,619,612		)	1,331,032
Retained earnings	291,644			291,644			815,121			9,415			(1,116,180		)	291,644
Accumulated other comprehensive loss	(12,578		)	(12,578		)	(26,292		)	(319		)	39,189			(12,578		)
Total Shareholders' equity	1,611,270			1,611,270			2,073,913			11,420			(3,696,603		)	1,611,270
Total liabilities and shareholders' equity	$	1,636,685		$	4,410,492		$	5,305,287		$	37,018		$	(6,268,620	)	$	5,120,862

32

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Pinnacle Foods Inc. Condensed Consolidating Balance Sheet December 29, 2013
	Pinnacle Foods Inc.			Pinnacle Foods Finance LLC			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations and Reclassifications			Consolidated Total
Current assets:
Cash and cash equivalents	$	—		$	—		$	104,345		$	12,394		$	—		$	116,739
Accounts receivable, net	—			—			156,417			8,247			—			164,664
Intercompany accounts receivable	25,119			—			188,941			—			(214,060		)	—
Inventories, net	—			—			355,685			6,187			—			361,872
Other current assets	—			850			6,931			111			—			7,892
Deferred tax assets	—			—			141,162			(20		)	—			141,142
Total current assets	25,119			850			953,481			26,919			(214,060		)	792,309
Plant assets, net	—			—			523,250			20			—			523,270
Investment in subsidiaries	1,598,041			2,027,337			12,453			—			(3,637,831		)	—
Intercompany note receivable	—			1,984,956			7,270			9,800			(2,002,026		)	—
Tradenames	—			—			1,951,392			—			—			1,951,392
Other assets, net	—			54,530			131,464			131			—			186,125
Deferred tax assets	—			284,606			—			—			(284,606		)	—
Goodwill	—			—			1,628,095			—			—			1,628,095
Total assets	$	1,623,160		$	4,352,279		$	5,207,405		$	36,870		$	(6,138,523	)	$	5,081,191
Current liabilities:
Short-term borrowings	$	—		$	—		$	2,437		$	—		$	—		$	2,437
Current portion of long-term obligations	—			21,550			3,030			—			—			24,580
Accounts payable	—			158			140,694			1,501			—			142,353
Intercompany accounts payable	—			207,123			—			6,937			(214,060		)	—
Accrued trade marketing expense	—			—			32,627			4,433			—			37,060
Accrued liabilities	—			15,306			83,667			782			—			99,755
Dividends payable	25,119			—			—			—			—			25,119
Total current liabilities	25,119			244,137			262,455			13,653			(214,060		)	331,304
Long-term debt	—			2,459,215			16,952			—			—			2,476,167
Intercompany note payable	—			—			1,994,163			7,863			(2,002,026		)	—
Pension and other postretirement benefits	—			—			49,847			—			—			49,847
Other long-term liabilities	—			1,136			20,694			2,730			—			24,560
Deferred tax liabilities	—			49,750			835,957			171			(284,606		)	601,272
Total liabilities	25,119			2,754,238			3,180,068			24,417			(2,500,692		)	3,483,150
Commitments and contingencies (Note 12)
Shareholder’s equity:
Pinnacle common stock	1,172			—			—			—			—			1,172
Additional paid-in-capital	1,328,847			1,330,019			1,285,084			2,324			(2,617,427		)	1,328,847
Retained earnings	275,519			275,519			768,718			10,504			(1,054,741		)	275,519
Accumulated other comprehensive loss	(7,497		)	(7,497		)	(26,465		)	(375		)	34,337			(7,497		)
Total Shareholders' equity	1,598,041			1,598,041			2,027,337			12,453			(3,637,831		)	1,598,041
Total liabilities and shareholders' equity	$	1,623,160		$	4,352,279		$	5,207,405		$	36,870		$	(6,138,523	)	$	5,081,191

33

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Pinnacle Foods Inc. Condensed Consolidating Statement of Operations and Comprehensive Earnings For the three months ended March 30, 2014
	Pinnacle Foods Inc.			Pinnacle Foods Finance LLC			Guarantor Subsidiaries		Nonguarantor Subsidiaries			Eliminations			Consolidated Total
Net sales	$	—		$	—		$	639,817	$	20,191		$	(15,969	)	$	644,039
Cost of products sold	—			194			473,945		18,929			(15,690		)	477,378
Gross profit	—			(194		)	165,872		1,262			(279		)	166,661
Operating expenses
Marketing and selling expenses	—			271			42,641		1,216			—			44,128
Administrative expenses	—			1,696			23,105		1,176			—			25,977
Research and development expenses	—			41			2,441		—			—			2,482
Intercompany royalties	—			—			—		9			(9		)	—
Intercompany technical service fees	—			—			—		270			(270		)	—
Other expense (income), net	—			—			3,983		—			—			3,983
Equity in (earnings) loss of investees	(40,748		)	(46,403		)	1,089		—			86,062			—
Total operating expenses	(40,748		)	(44,395		)	73,259		2,671			85,783			76,570
Earnings before interest and taxes	40,748			44,201			92,613		(1,409		)	(86,062		)	90,091
Intercompany interest (income) expense	—			(16,890		)	16,855		35			—			—
Interest expense	—			23,912			447		8			—			24,367
Interest income	—			—			11		15			—			26
Earnings before income taxes	40,748			37,179			75,322		(1,437		)	(86,062		)	65,750
Provision (benefit) for income taxes	—			(3,569		)	28,919		(348		)	—			25,002
Net earnings	$	40,748		$	40,748		$	46,403	$	(1,089	)	$	(86,062	)	$	40,748
Total comprehensive earnings (loss)	$	35,667		$	35,667		$	46,633	$	(948	)	$	(81,352	)	$	35,667

34

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Pinnacle Foods Inc. Condensed Consolidating Statement of Operations and Comprehensive Earnings For the three months ended March 31, 2013
	Pinnacle Foods Inc.			Pinnacle Foods Finance LLC			Guarantor Subsidiaries			Nonguarantor Subsidiaries		Eliminations			Consolidated Total
Net sales	$	—		$	—		$	606,581		$	20,616	$	(14,216	)	$	612,981
Cost of products sold	—			12			454,483			17,565		(13,920		)	458,140
Gross profit	—			(12		)	152,098			3,051		(296		)	154,841
Operating expenses
Marketing and selling expenses	—			70			43,901			1,657		—			45,628
Administrative expenses	—			578			21,063			917		—			22,558
Research and development expenses	—			5			2,322			—		—			2,327
Intercompany royalties	—			—			—			9		(9		)	—
Intercompany technical service fees	—			—			—			287		(287		)	—
Other expense (income), net	—			—			3,657			—		—			3,657
Equity in (earnings) loss of investees	(24,796		)	(35,425		)	(89		)	—		60,310			—
Total operating expenses	(24,796		)	(34,772		)	70,854			2,870		60,014			74,170
Earnings before interest and taxes	24,796			34,760			81,244			181		(60,310		)	80,671
Intercompany interest (income) expense	—			(23,290		)	23,258			32		—			—
Interest expense	—			40,080			569			7		—			40,656
Interest income	—			—			2			1		—			3
Earnings before income taxes	24,796			17,970			57,419			143		(60,310		)	40,018
Provision (benefit) for income taxes	—			(6,826		)	21,994			54		—			15,222
Net earnings	$	24,796		$	24,796		$	35,425		$	89	$	(60,310	)	$	24,796
Total comprehensive earnings (loss)	$	25,919		$	25,919		$	36,109		$	493	$	(62,521	)	$	25,919

35

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Pinnacle Foods Inc. Condensed Consolidating Statement of Cash Flows For the three months ended March 30, 2014
	Pinnacle Foods Inc.			Pinnacle Foods Finance LLC			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations and Reclassifications			Consolidated Total
Cash flows from operating activities
Net cash provided by (used in) operating activities	$	—		$	(4,503	)	$	98,937		$	(495	)	$	—		$	93,939
Cash flows from investing activities
Intercompany accounts receivable/payable	—			9,891			—			—			(9,891		)	—
Capital expenditures	—			—			(22,406		)	—			—			(22,406		)
Net cash (used in) provided by investing activities	—			9,891			(22,406		)	—			(9,891		)	(22,406		)
Cash flows from financing activities
Proceeds from issuance of common stock	73			—			—			—			—			73
Dividends paid	—			—			(24,310		)	—			—			(24,310		)
Repayments of long-term obligations	—			(5,388		)	—			—			—			(5,388		)
Proceeds from short-term borrowing	—			—			960			—			—			960
Repayments of short-term borrowing	—			—			(978		)	—			—			(978		)
Intercompany accounts receivable/payable	(73		)	—			(9,818		)				9,891			—
Repayment of capital lease obligations	—			—			(674		)	—			—			(674		)
Net cash (used in) provided by financing activities	—			(5,388		)	(34,820		)	—			9,891			(30,317		)
Effect of exchange rate changes on cash	—			—			—			81			—			81
Net change in cash and cash equivalents	—			—			41,711			(414		)	—			41,297
Cash and cash equivalents - beginning of period	—			—			104,345			12,394			—			116,739
Cash and cash equivalents - end of period	$	—		$	—		$	146,056		$	11,980		$	—		$	158,036
Supplemental disclosures of cash flow information:
Interest paid	$	—		$	18,162		$	432		$	—		$	—		$	18,594
Interest received	—			15			11			—			—			26
Income taxes paid	—			—			599			358			—			957
Non-cash investing and financing activities:
New capital leases	—			—			282			—			—			282
Dividends payable	25,415			—			—			—			—			25,415

36

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

Pinnacle Foods Inc. Condensed Consolidating Statement of Cash Flows For the three months ended March 31, 2013
	Pinnacle Foods Inc.			Pinnacle Foods Finance LLC			Guarantor Subsidiaries			Nonguarantor Subsidiaries			Eliminations and Reclassifications			Consolidated Total
Cash flows from operating activities
Net cash provided by (used in) operating activities	$	—		$	(17,523	)	$	85,357		$	(90	)	$	—		$	67,744
Cash flows from investing activities
Intercompany accounts receivable/payable	—			28,291			—			—			(28,291		)	—
Capital expenditures	—			—			(18,242		)	—			—			(18,242		)
Sale of plant assets	—			—			1,775			—			—			1,775
Net cash (used in) provided by investing activities	—			28,291			(16,467		)	—			(28,291		)	(16,467		)
Cash flows from financing activities
Repayments of long-term obligations	—			(10,581		)	—			—			—			(10,581		)
Proceeds from short-term borrowing	—			—			1,107			—			—			1,107
Repayments of short-term borrowing	—			—			(1,415		)	—			—			(1,415		)
Intercompany accounts receivable/payable				—			(28,291		)				28,291			—
Repayment of capital lease obligations	—			—			(550		)	—			—			(550		)
Parent reduction in investment in subsidiary	187			(187		)	—			—			—			—
Repurchases of equity	(187		)	—			—			—			—			(187		)
Net cash (used in) provided by financing activities	—			(10,768		)	(29,149		)	—			28,291			(11,626		)
Effect of exchange rate changes on cash	—			—			—			162			—			162
Net change in cash and cash equivalents	—			—			39,741			72			—			39,813
Cash and cash equivalents - beginning of period	—			—			83,123			9,158			—			92,281
Cash and cash equivalents - end of period	$	—		$	—		$	122,864		$	9,230		$	—		$	132,094
Supplemental disclosures of cash flow information:
Interest paid	$	—		$	35,776		$	549		$	—		$	—		$	36,325
Interest received	—			1			2			—			—			3
Income taxes (refunded) paid	—			—			195			109			—			304
Non-cash investing and financing activities:
New capital leases	—			—			4,668			—			—			4,668

17. Subsequent Events

Duncan Hines co-manufacturing business acquisition

On March 31, 2014, the Company acquired the Duncan Hines manufacturing business located in Centralia, Illinois, from Gilster Mary Lee Corporation (“Gilster”), the Company's primary co-packer. The cost of the acquisition was $16.5 million plus an additional $10.2 million for the cost of the inventory purchased. The Company paid $11.8 million in cash, with the balance due under a $14.9 millionfour-year note, bearing interest at 3.0% annually, payable monthly to Gilster through March 31, 2018.

Hillshire transaction

On May 12, 2014 the Company entered into a definite agreement for the sale of the Company to Hillshire Brands ("Hillshire") for approximately $6.7 billion, including the assumption of debt. Under the terms of the agreement, Hillshire will acquire all outstanding

37

PINNACLE FOODS INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

(thousands of dollars, except share and per share amounts and where noted in millions)

shares of the Company. The Company's stockholders will receive $18.00 in cash for each share held, along with Hillshire common stock at a fixed exchange ratio of 0.50 Hillshire shares for each Pinnacle share. Upon the closing of the transaction, the Company's shareholders will own approximately 33% of the combined company. Until the time of the closing, the Company will continue to maintain its current quarterly dividend payments.

The combined company will have annual net revenues of approximately $6.6 billion and be led by current Hillshire President and CEO Sean Connolly.

The transaction, which is subject to customary regulatory and shareholder approvals, is expected to close by September 2014. Certain affiliates of Blackstone, which collectively hold approximately 51% of the Company’s outstanding common stock, have entered into a voting agreement and, subject to its terms and conditions, agreed to vote their shares in favor of the transaction. Upon close of the transaction, Hillshire will appoint a representative from Blackstone to its board.

38

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(dollars in millions, except where noted)

You should read the following discussion of our results of operations and financial condition together with the audited consolidated financial statements appearing in our annual report on Form 10-K filed with the Securities and Exchange Commission on March 6, 2014 and the unaudited Consolidated Financial Statements and the notes thereto included in this quarterly report. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in the “Risk Factors” section of our Form 10-K, and the section entitled “Special Note Regarding Forward-Looking Statements” in this report. Actual results may differ materially from those contained in any forward-looking statements.

Overview

We are a leading manufacturer, marketer and distributor of high quality, branded food products in North America. We manage the business in three operating segments: Birds Eye Frozen, Duncan Hines Grocery and Specialty Foods. Our Birds Eye Frozen Division manages our Leadership Brands in the United States retail frozen vegetables (Birds Eye), frozen complete bagged meals (Birds Eye Voila!), and frozen prepared seafood (Van de Kamp’s and Mrs. Paul’s) categories, as well as our Foundation Brands in the full-calorie single-serve frozen dinners and entrées (Hungry-Man), frozen pancakes / waffles / French Toast (Aunt Jemima), frozen and refrigerated bagels (Lender’s) and frozen pizza for one (Celeste) categories. Our Duncan Hines Grocery Division manages our Leadership Brands in the baking mixes and frostings (Duncan Hines), liquid and dry-mix salad dressings (Wish-Bone and Western), shelf-stable pickles (Vlasic), and table syrups (Mrs. Butterworth’s and Log Cabin) categories, and our Foundation Brands in the canned meat (Armour, Nalley and Brooks), pie and pastry fillings (Duncan Hines Comstock and Wilderness), barbecue sauces (Open Pit) and salad dressing (Bernstein’s) categories as well as all Canadian operations. We refer to the sum of our Birds Eye Frozen Division and our Duncan Hines Grocery Division as our North America Retail businesses. Our Specialty Foods Division consists of snack products (Tim’s Cascade and Snyder of Berlin) and our Foodservice and Private Label businesses.

Within our divisions, we actively manage our portfolio by segregating our business into Leadership Brands and Foundation Brands. Our Leadership Brands enjoy a combination of higher growth, greater potential for value-added innovation and enhanced responsiveness to consumer marketing than do our Foundation Brands. As a result, we focus our brand-building activities on our Leadership Brands. By contrast, we manage our Foundation Brands for revenue and market share stability and for cash flow generation to support investment in our Leadership Brands, reduce our debt and fund other corporate priorities. As a result, we focus spending for our Foundation Brands on brand renovation and targeted consumer and trade programs.

Segment performance is evaluated by the Company’s Chief Operating Decision Maker and is based on earnings before interest and taxes. Transfers between segments and geographic areas are recorded at cost plus markup or at market. Identifiable assets are those assets, including goodwill, which are identified with the operations in each segment or geographic region. Corporate assets consist of prepaid and deferred tax assets. Unallocated corporate expenses consist of corporate overhead such as executive management and finance and legal functions. Product contribution is defined as gross profit less direct to consumer advertising and marketing expenses, selling commission and direct brand marketing overhead expenses.

Business Drivers and Measures

In operating our business and monitoring its performance, we pay attention to trends in the food manufacturing industry and a number of performance measures and operational factors. The industry has experienced volatility in overall commodity prices over the past three years. The industry has managed this commodity inflation by increasing retail prices, which has affected consumer buying patterns and led to lower volumes in many categories. The overall food industry continues to face top line challenges, with overall volume softness and a more challenging environment to fully pass on price increases due to weak consumer demand.

Industry Trends

Growth in our industry is driven primarily by population growth, changes in product selling prices and changes in consumption between out-of-home and in-home eating. In the current economic environment, consumers are looking for value alternatives, which has caused an increase in the percentage of products sold on promotion and a shift from traditional retail grocery to mass

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merchandisers, club stores and the dollar store channel. We are well positioned in grocery and alternative channels, maintaining strong customer relationships across key retailers in each division.

In order to maintain and grow our business, we must successfully react to, and offer products that respond to, evolving consumer trends, such as changing health trends and focus on convenience and products tailored for busy lifestyles. Incremental growth in the industry is principally driven by product and packaging innovation.

Revenue Factors

Our net sales are driven principally by the following factors:

• Gross sales, which change as a function of changes in volume and list price; and

• the costs that we deduct from gross sales to arrive at net sales, which consist of:

◦ Cash discounts, returns and other allowances.

◦ Trade marketing expenses, which include the cost of temporary price reductions (“on sale” prices), promotional displays and advertising space in store circulars.

◦ New product distribution (slotting) expenses, which are the costs of having certain retailers stock a new product, including amounts retailers charge for updating their warehousing systems, allocating shelf space and in-store systems set-up, among other things.

◦ Consumer coupon redemption expenses, which are costs from the redemption of coupons we circulate as part of our marketing efforts.

Cost Factors

Costs recorded in Cost of products sold in the consolidated statement of operations include:

◦ Raw materials, such as sugar, cucumbers, broccoli, corn, peas, green beans, carrots, flour (wheat), poultry, seafood, vegetable oils, shortening, meat and corn syrup, among others, are available from numerous independent suppliers but are subject to price fluctuations due to a number of factors, including changes in crop size, federal and state agricultural programs, export demand, weather conditions and insects, among others.

◦ Packaging costs. Our broad array of products entails significant costs for packaging and is subject to fluctuations in the price of aluminum, glass jars, plastic trays and bottles, corrugated fiberboard, and plastic packaging materials.

◦ Conversion costs, which include all costs necessary to convert raw materials into finished product. Key components of this cost include direct labor, and plant overhead such as salaries, benefits, utilities and depreciation.

◦ Freight and distribution. We use a combination of common carriers and inter-modal rail to transport our products from our manufacturing facilities to distribution centers and to deliver products to our customers from both those centers and directly from our manufacturing plants. Our freight and distribution costs are influenced by fuel costs as well as capacity within the industry.

Costs recorded in marketing and selling expenses in the consolidated statement of operations include:

◦ Advertising and other marketing expenses. These expenses consist of personnel and facility charges and also include third party professional and other services. Our lean, nimble structure and efficient internal processes have enabled us to hold our overhead costs (i.e., selling, general and administrative expenses, excluding marketing investment and one-time items) to less than 9.0% of net sales.

◦ Research and Development. These expenses consist of personnel and facility charges and include expenditures on new products and the improvement and maintenance of existing products and processes.

Working Capital

Our working capital is primarily driven by accounts receivable and inventories, which fluctuate throughout the year due to seasonality in both sales and production. See “Seasonality.” We will continue to focus on reducing our working capital requirements while simultaneously maintaining our customer service levels and fulfilling our production requirements. We have historically relied on internally generated cash flows and temporary borrowings under our revolving credit facility to satisfy our working capital requirements.

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Other Factors

Other factors that have influenced our results of operations and may do so in the future include:

• Interest Expense. Our 2013 IPO and debt refinancings (the “April 2013 Refinancing”) have improved our debt profile and significantly reduced our leverage and our expected future interest expense. See Note 1 and Note 9 to the consolidated financial statements included elsewhere in this 10-Q for further details. However, as a result of the Blackstone Transaction, the Birds Eye Acquisition and the Wish-Bone acquisition, we still have significant indebtedness. Although we expect to continue to reduce our leverage over time, we expect interest expense to continue to be a significant, although much less than before, component of our expenses. See “Liquidity and Capital Resources” below.

• Cash Taxes. We have significant tax-deductible intangible asset amortization and federal and state Net Operating Loss Carryforwards, ("NOLCs"), which resulted in minimal federal and state cash taxes in recent years. We expect continued amortization and utilization of our NOLCs will reduce the majority of our federal and state income tax through 2015 and generate modest annual cash tax savings beyond 2015.

• Acquisitions and Consolidations. We believe we have the expertise to identify and integrate value-enhancing acquisitions to further grow our business. We have successfully integrated acquisitions in the past. We have, however, incurred significant costs in connection with integrating these businesses and streamlining our operations. On October 1, 2013 we acquired Wish-Bone from Unilever PLC for cash consideration of $575.2 million and expect to incur approximately $50.0 million in capital expenditures and approximately $8.0 million of additional expenditures to integrate the business and drive significant synergies and cost efficiencies. As of December 30, 2013, exclusive of the ongoing co-manufacturing agreement, the Wish-Bone business was fully integrated into Pinnacle.

Seasonality

Our sales and cash flows are affected by seasonal cyclicality. Sales of frozen foods, including frozen vegetables and frozen complete bagged meals, tend to be marginally higher during the winter months. Seafood sales peak during Lent, in advance of the Easter holiday. Sales of pickles, relishes, barbecue sauces, potato chips and salad dressings tend to be higher in the spring and summer months, and demand for Duncan Hines products, Birds Eye vegetables and our pie and pastry fruit fillings tend to be higher around the Easter, Thanksgiving, and Christmas holidays. Since many of the raw materials we process under the Birds Eye, Vlasic and Duncan Hines Comstock and Wilderness brands are agricultural crops, production of these products is predominantly seasonal, occurring during and immediately following the purchase of such crops. We also increase our Duncan Hines inventories in advance of the peak fall selling season. As a result, our inventory levels tend to be higher during August, September, and October, and thus we require more working capital during these months. Typically, we are a seasonal net user of cash in the third quarter of the calendar year.

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Results of Operations:

Consolidated Statements of Operations

The following tables set forth our statement of operations data expressed in dollars and as a percentage of net sales.

	Three months ended
	March 30, 2014				March 31, 2013
Net sales	$	644.0	100.0	%	$	613.0	100.0	%
Cost of products sold	477.4		74.1	%	458.1		74.7	%
Gross profit	166.6		25.9	%	154.9		25.3	%
Operating expenses:
Marketing and selling expenses	$	44.1	6.9	%	$	45.6	7.4	%
Administrative expenses	26.0		4.0	%	22.6		3.7	%
Research and development expenses	2.5		0.4	%	2.3		0.4	%
Other expense (income), net	4.0		0.6	%	3.7		0.6	%
Total operating expenses	$	76.6	11.9	%	$	74.2	12.1	%
Earnings before interest and taxes	$	90.1	14.0	%	$	80.7	13.2	%

	Three months ended
	March 30, 2014			March 31, 2013
Net sales
Birds Eye Frozen	$	294.3		$	292.5
Duncan Hines Grocery	264.9			227.2
North America Retail	559.2			519.7
Specialty Foods	84.9			93.3
Total	$	644.0		$	613.0
Earnings before interest and taxes
Birds Eye Frozen	$	46.7		$	48.9
Duncan Hines Grocery	42.7			29.4
Specialty Foods	7.1			8.2
Unallocated corporate expenses	(6.4		)	(5.9		)
Total	$	90.1		$	80.7
Depreciation and amortization
Birds Eye Frozen	$	9.9		$	9.3
Duncan Hines Grocery	6.5			5.8
Specialty Foods	4.0			4.2
Total	$	20.4		$	19.3

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Adjustments to Earnings (loss) before Interest and Taxes and Depreciation and Amortization used in the calculation of Adjusted EBITDA as described below in the "Covenant Compliance" section, by Segment, are as follows:

	Three months ended
	March 30, 2014		March 31, 2013
Adjustments to Earnings (loss) before interest and taxes (1)
Birds Eye Frozen	$	0.4	$	0.8
Duncan Hines Grocery	2.2		2.4
Specialty Foods	0.1		—
Unallocated corporate expenses	—		1.1

(1) The amounts in the three months ended March 31, 2013 have been conformed to the current year presentation as equity based compensation is no longer treated as an adjustment to Earnings (loss) before interest and taxes.

Three months ended March 30, 2014 compared to the three months ended March 31, 2013

Net sales

Net sales for the three months ended March 30, 2014 increased $31.1 million or 5.1% versus year-ago to $644.0 million, reflecting a 7.4% increase from the benefit of the Wish-Bone acquisition. This was partially offset by a 1.2% decrease from volume/mix which included an approximately 2% unfavorable impact resulting from the Easter holiday occurring three weeks later in 2014 as compared to 2013 and a decline in Specialty Foods. Also impacting the comparison was lower net pricing of 0.8% and a 0.3% decrease from foreign exchange.

Net sales in our North America Retail businesses for the first quarter increased 7.6% versus year-ago to $559.2 million, including an 8.7% increase from the Wish-Bone acquisition and a 0.1% increase from volume/mix including the unfavorable impact of the Easter shift. Also impacting the comparison was lower net pricing of 0.8% and a 0.4% decrease from foreign exchange.

Birds Eye Frozen Division:

Net sales in the three months ended March 30, 2014 increased 0.6% versus year-ago to $294.3 million, reflecting a 0.7% increase from volume/mix and lower net pricing of 0.1%. During the period we realized strong sales of Birds EyeVoila! complete bagged meals, Mrs. Paul's and Van de Kamp's seafood and our Hungry-Man entrées. These increases were partially offset by lower sales of Birds Eye vegetables primarily resulting from the later Easter holiday compared to 2013 and new product introductory costs behind Birds Eye Steamfresh and Hunger-Man Selects varieties.

Duncan Hines Grocery Division:

Net sales in the three months ended March 30, 2014 increased 16.6% versus year-ago to $264.9 million, reflecting a 19.8% increase from the Wish-Bone acquisition. This was partially offset by a 0.5% decrease from volume/mix, lower net pricing of 1.8% and a 0.9% decrease from foreign exchange. In addition to Wish-Bone, positive contributors to the quarter also included Armour canned meats and Nalley chili. Partially offsetting these increases were lower sales from Duncan Hines and Vlasicpickles, primarily resulting from the later Easter holiday compared to 2013. During the quarter we introduced new blue and pink velvet line extensions of our Duncan Hines Signature cakes.

Specialty Foods Division:

Net sales in the three months ended March 30, 2014 were $84.9 million, a decline of 9.1%, reflecting an 8.7% decrease from volume/mix and lower net pricing of 1.0%, partially offset by a 0.6% benefit from the Wish-Bone foodservice business. This decline was primarily driven by lower volume of private label canned meat partially offset by increased sales from our snacks business.

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Gross profit

Gross profit for the three months ended March 30, 2014 was $166.6 million, or 25.9% of net sales, compared to $154.9 million, or 25.3% of net sales, in the comparable prior year period. The increase in gross profit as a percentage of net sales was largely driven by improved productivity and favorable product mix.

The following table outlines the factors resulting in the increase in gross profit in the three months ended March 30, 2014 of $11.7 million and the 0.6 percentage-point increase in gross margin percentage.

	$ (in millions)			% net sales
Productivity	$	13.0		2.0	%
Favorable product mix	9.5			1.3
Inflation (principally higher commodity costs)	(16.0		)	(2.5	)
Lower net price realization, net of slotting	(5.2		)	(0.6	)
Other	2.4			0.4
Subtotal	$	3.7		0.6	%
Higher sales volume, including Wish-Bone	8.0
Total	$	11.7

Marketing and selling expenses

Marketing and selling expenses decreased 3.3% to $44.1 million, or 6.9% of net sales, for the three months ended March 30, 2014, compared to $45.6 million, or 7.4% of net sales for the prior year period primarily reflecting timing of advertising spending within the year.

Administrative expenses

Administrative expenses were $26.0 million, or 4.0% of net sales, for the three months ended March 30, 2014, compared to $22.6 million, or 3.7% of net sales, for the comparable prior year period. The largest drivers of the increase were $1.5 million of equity based compensation and $0.7 million of depreciation expense.

Research and development expenses:

Research and development expenses of $2.5 million, or 0.4% of net sales, for the three months ended March 30, 2014 compared to $2.3 million, or 0.4% of net sales, for the prior year period.

Other income and expense:

	Three months ended
	March 30, 2014			March 31, 2013
Other expense (income), net consists of:
Amortization of intangibles/other assets	$	4.2		$	3.9
Royalty income and other	(0.2		)	(0.2		)
Total other expense (income), net	$	4.0		$	3.7

Earnings before interest and taxes

Earnings before interest and taxes for the three months ended March 30, 2014 increased $9.4 million, or 11.7%, versus year-ago to $90.1 million, principally from improved gross profit driven by productivity, favorable product mix and higher volumes, including the benefit of the Wish-Bone acquisition, partially offset by inflation and higher administrative expenses largely related to equity based compensation and depreciation.

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Birds Eye Frozen Division:

Earnings before interest and taxes for the three months ended March 30, 2014 were $46.7 million, a decline of $2.2 million, or 4.5%, versus year-ago, largely due to lower gross profit driven by higher commodity and logistics costs and the unfavorable impact of the later Easter holiday, partially offset by lower marketing investment in the quarter.

Duncan Hines Grocery Division:

Earnings before interest and taxes increased 45.0%, or $13.2 million, versus year-ago to $42.7 million for the three months ended March 30, 2014, primarily reflecting the benefit of the Wish-Bone acquisition, reduced commodity prices and lower marketing investment in the quarter, partially offset by the unfavorable impact of the later Easter holiday.

Specialty Foods Division:

Earnings before interest and taxes for the three months ended March 30, 2014 were $7.1 million, a decline of $1.1 million, or 13.6%, versus year-ago, primarily reflecting lower sales of private label canned meat.

Interest expense, net

Net interest expense declined 40.1%, or $16.3 million, to $24.3 million in the three months ended March 30, 2014 from $40.7 million in the three months ended March 31, 2013 largely resulting from lower outstanding debt balances driven by IPO related debt reduction as well as lower interest rates on our Notes due to the benefit of our April 2013 refinancing.

We utilize interest rate swap agreements to reduce the potential exposure to interest rate movements and to achieve a desired proportion of variable versus fixed rate debt. Any gains or losses realized on the interest rate swap agreements, excluding the Accumulated other comprehensive (loss) earnings (“AOCL”) portion, are recorded as an adjustment to interest expense. Included in net interest expense was $0.8 million for the first quarter of 2013, and none in 2014, recorded from losses on interest rate swap agreements.

Provision for income taxes

The effective tax rate was 38.0% in both the three month periods ended March 30, 2014 and March 31, 2013. For each of the three months ended each of March 30, 2014 and March 31, 2013, the tax rate reflects a benefit of approximately 0.9%  related to tax legislation enacted in each of the respective periods. For the three months ended March 30, 2014 and March 30, 2013, we maintained a valuation allowance against certain state net operating loss carryovers, state tax credit carryovers, and foreign loss carryovers from Birds Eye's former Canadian operations. There was no change in the valuation allowance for either of the respective three-month reporting periods.

Under Internal Revenue Code (“the Code”) Section 382, the Company is a loss corporation. Section 382 of the Code places limitations on our ability to use a portion of our NOL carryovers to offset income. The annual Federal NOL limitation that applies to a portion of our NOLs is approximately $17.0 million to $23.0 million, subject to other rules and restrictions. The Company also has available unencumbered NOLs that are expected to be utilized. Our NOLs and certain other tax attributes generated prior to December 23, 2009 may not be utilized to offset Birds Eye income from recognized built-in gains through December 2014, pursuant to Section 384 of the Code.

We have significant tax-deductible intangible asset amortization and federal and state NOLs, which resulted in minimal federal and state cash taxes in recent years. We expect continued amortization and utilization of our NOLs will reduce the majority of our federal and state income tax through 2015.

Liquidity and capital resources

Historical

Our cash flows are seasonal. Typically we are a net user of cash in the third quarter of the calendar year (i.e., the quarter ending in September) and a net generator of cash over the balance of the year.

Our principal liquidity requirements have been, and we expect will be, for working capital and general corporate purposes, including capital expenditures and debt service. In addition, subsequent to the IPO, the Company initiated a quarterly dividend program. Currently, the quarterly payment is $0.21 per share, or approximately $24 million per quarter. Capital expenditures are expected to be approximately $120 to $130 million in 2014, which include approximately $50 million related to our acquisition integration

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projects. We have historically satisfied our liquidity requirements with internally generated cash flows and availability under our revolving credit facility. We expect that our ability to generate cash from our operations and ability to borrow from our credit facilities should be sufficient to support working capital needs, planned growth, capital expenditures, debt service and dividends for the next 12 months and for the foreseeable future. We keep an insignificant amount of cash in foreign accounts, primarily related to the operations of our Canadian business. Tax liabilities related to bringing these funds back into the United States would not be significant and have been accrued.

Statements of cash flows for the three months ended March 30, 2014 compared to the three months ended March 31, 2013

For the three months ended March 30, 2014, the net of all activities resulted in an increase in cash of $41.3 million compared to an increase in cash of $39.8 million for the three months ended March 31, 2013.

Net cash provided by operating activities was $93.9 million for the three months ended March 30, 2014 and was the result of net earnings, excluding non-cash charges and credits, of $87.4 million and a decrease in working capital of $6.5 million. The decrease in working capital was primarily the result of a $22.0 million decrease in inventories resulting from the sell-down of the seasonal inventory build from December 2013, a $12.0 million increase in accounts payable related to both Wish-Bone and the timing of our inventory purchases and a $3.2 million increase in accrued trade marketing expense driven by the seasonality of our marketing programs. These were partially offset by a $21.2 million increase in accounts receivable driven by the timing of sales and a $9.1 million decrease in accrued liabilities primarily attributable to a lower bonus accrual resulting from the 2013 bonus being paid in March, 2014. The aging profile of accounts receivable has not changed significantly from December 2013. All other working capital accounts generated a net $0.3 million cash outflow.

Net cash provided by operating activities was $67.7 million for the three months ended March 31, 2013 and was the result of net earnings, excluding non-cash charges and credits of $58.6 million and a decrease in working capital of $9.1 million. The decrease in working capital was primarily the result of a $32.0 million decrease in inventories resulting from the sell-down of the seasonal inventory build from December 2012 and a $11.1 million seasonal increase in accrued liabilities. These were offset by a $24.7 million increase in accounts receivable driven by the timing of sales and a $10.3 million decrease in accounts payable driven by our inventory purchases. The aging profile of accounts receivable did not change significantly from December 2012. All other working capital accounts generated a net $1.1 million cash inflow.

Net cash used in investing activities was $22.4 million for the three months ended March 30, 2014 and was related to capital expenditures. Capital expenditures during the first three months of 2014 included approximately $10.4 million of costs related to our acquisition integration projects.

Net cash used in investing activities was $16.5 million for the three months ended March 31, 2013 and was primarily related to capital expenditures. Capital expenditures during the first three months of 2013 included approximately $4.7 million of costs related to our facility consolidation projects. Investing activities also included $1.8 million of proceeds from the sale of assets previously held for sale.

Net cash used by financing activities for the three months ended March 30, 2014 was $30.3 million and consisted of $24.3 million of dividends paid and $5.4 million of term loan repayments. All other financing activities generated a net $0.6 million outflow.

Net cash used by financing activities for the three months ended March 31, 2013 was $11.6 million and consisted principally of $10.6 million of term loan repayments. All other financing activities resulted in a net $1.0 million outflow.

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Debt

As of March 30, 2014 and December 29, 2013, our long term debt consisted of the following:

	March 30, 2014			December 29, 2013
Long-term debt
- Senior Secured Credit Facility - Tranche G Term Loan due 2020	1,617.8			1,621.9
- Senior Secured Credit Facility - Tranche H Term Loan due 2020	523.7			525.0
- 4.875% Senior Notes due 2021	350.0			350.0
- Unamortized discount on long term debt	(15.5		)	(16.1		)
- Capital lease obligations	19.6			20.0
	2,495.6			2,500.8
Less: current portion of long-term obligations	24.6			24.6
Total long-term debt	$	2,471.0		$	2,476.2

To partially fund the Wish-Bone acquisition, on October 1, 2013 Pinnacle Foods Finance, the Company's wholly-owned subsidiary, entered into an amendment to the Second Amended and Restated Credit Agreement (the “Amendment”) in the form of incremental term loans in the amount of $525.0 million (the “Tranche H Term Loans”). In connection with Tranche H Term Loans, Pinnacle Foods Finance incurred $8.5 million of original issue discount and deferred financing fees of $10.5 million.

On April 29, 2013, Pinnacle Foods Finance, entered into the second amendment to the amended and restated Senior Secured Credit Facility, which provided for a seven year term loan facility in the amount of $1,630.0 million (the "Tranche G Term Loans") and replaced the existing revolving credit facility with a new five year $150.0 million revolving credit facility. Additionally, Pinnacle Foods Finance issued $350.0 million aggregate principal amount of 4.875% Senior Notes (the "4.875% Senior Notes") due 2021.

We meet the service requirements on our debt utilizing cash flow generated from operations. In addition to the above facilities, we have a $150.0 million revolving credit facility, which can be used to fund our working capital needs and can also be used to issue up to $50.0 million of letters of credit. There were no borrowings against the revolving credit facility as of March 30, 2014 and December 29, 2013, except in respect of letters of credit as set forth below. As of March 30, 2014 and December 29, 2013, we had issued approximately $31.6 million and $32.9 million, respectively, of letters of credit under this facility, leaving approximately $118.4 million and $117.1 million, respectively, of unused capacity under the revolving credit facility.

The term loans under the Senior Secured Credit Facility amortize in quarterly installments of 0.25%. The scheduled principal payments of the Tranche G Term Loans outstanding as of March 30, 2014 are $12.2 million in the remainder of 2014, $16.3 million in 2015, $16.3 million in 2016, $20.4 million in 2017, $12.2 million in 2018 and $1,540.4 million thereafter. The scheduled principal payments of the Tranche H Term Loans outstanding as of March 30, 2014 are $3.9 million in the remainder of 2014, $5.3 million in 2015, $5.3 million in 2016, $6.6 million in 2017, $3.9 million in 2018 and $498.7 million thereafter.

Under the terms of our Senior Secured Credit Facility, we are required to use 50% of our “Excess Cash Flow” to prepay the term loans under the Senior Secured Credit Facility (which percentage will be reduced to 25% at a total leverage ratio of between 4.50 and 5.49 and 0% at a total leverage ratio below 4.50). Excess Cash Flow is defined as consolidated net income (as defined), as adjusted for certain items, including (1) all non-cash charges and credits included in arriving at consolidated net income, (2) changes in working capital, (3) capital expenditures (to the extent they were not financed with debt), (4) the aggregate amount of principal payments on indebtedness and (5) certain other items defined in the Senior Secured Credit Facility. For the 2013 reporting year, we determined that there were no amounts due under the Excess Cash Flow requirements of the Senior Secured Credit Facility.

As market conditions warrant, we and our subsidiaries, affiliates or significant equity holders (including Blackstone and its affiliates) may from time to time, in our or their sole discretion, purchase, repay, redeem or retire any of our outstanding debt or equity securities (including any publicly issued debt or equity securities), in privately negotiated or open market transactions, by tender offer, exchange offer or otherwise.

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Covenant Compliance

The following is a discussion of the financial covenants contained in our debt agreements.

Senior Secured Credit Facility

Our Senior Secured Credit Facility contains a number of covenants that, among other things, restrict, subject to certain exceptions, our ability to:

• incur additional indebtedness and make guarantees;

• create liens on assets;

• engage in mergers or consolidations;

• sell assets;

• pay dividends and distributions or repurchase our capital stock;

• make investments, loans and advances, including acquisitions; and

• engage in certain transactions with affiliates.

The Senior Secured Credit Facility also contains certain customary affirmative covenants and events of default.

4.875% Senior Notes

The 4.875% Senior Notes are general senior unsecured obligations, effectively subordinated in right of payment to all of our existing and future senior secured indebtedness, and guaranteed on a full, unconditional, joint and several basis by our wholly-owned domestic subsidiaries that guarantee our other indebtedness.

The indenture governing the 4.875% Senior Notes limits our (and most or all of our subsidiaries’) ability to, subject to certain exceptions:

• incur additional debt or issue certain preferred shares;

• pay dividends on or make other distributions in respect of our capital stock or make other restricted payments;

• make certain investments;

• sell certain assets;

• create liens on certain assets to secure debt;

• consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;

• enter into certain transactions with our affiliates; and

• designate our subsidiaries as unrestricted subsidiaries.

Subject to certain exceptions, the indenture governing the 4.875% Senior Notes permits us and our restricted subsidiaries to incur additional indebtedness, including secured indebtedness.

Covenant Compliance EBITDA

The Company's metric of Adjusted EBITDA, which is used in creating targets for the bonus portion of our compensation plan, is substantially equivalent to Covenant Compliance EBITDA under our debt agreements.

Pursuant to the terms of the Senior Secured Credit Facility, Pinnacle Foods Finance is required to maintain a ratio of Net First Lien Secured Debt to Covenant Compliance EBITDA of no greater than 5.75 to 1.00. Net First Lien Secured Debt is defined as Pinnacle Foods Finance's aggregate consolidated secured indebtedness secured on a first lien basis, less the aggregate amount of all unrestricted cash and cash equivalents.

In addition, under the Senior Secured Credit Facility and the indenture governing the 4.875% Senior Notes, our ability to engage in activities such as incurring additional indebtedness, making investments and paying dividends is tied to the Senior Secured Leverage Ratio (which is currently the same as the ratio of Net First Lien Secured Debt to Covenant Compliance EBITDA described above), in the case of the Senior Secured Credit Facility, or to the ratio of Covenant Compliance EBITDA to fixed charges for the most recently concluded four consecutive fiscal quarters, in the case of the Senior Notes. We believe that these covenants are material terms of these agreements and that information about the covenants is material to an investor's understanding our financial performance. As of March 30, 2014, we were in compliance with all covenants and other obligations under the Senior Secured Credit Facility and the indenture governing the 4.875% Senior Notes.

Covenant Compliance EBITDA is defined as earnings (loss) before interest expense, taxes, depreciation and amortization (“EBITDA”), further adjusted to exclude non-cash items, extraordinary, unusual or non-recurring items and other adjustment items

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permitted in calculating Covenant Compliance EBITDA under the Senior Secured Credit Facility and the indenture governing the Senior Notes. We believe that the inclusion of supplementary adjustments to EBITDA applied in presenting Covenant Compliance EBITDA is appropriate to provide additional information to investors to demonstrate compliance with our financial covenants.

EBITDA and Covenant Compliance EBITDA do not represent net earnings or loss or cash flow from operations as those terms are defined by U.S. Generally Accepted Accounting Principles (“GAAP”) and do not necessarily indicate whether cash flows will be sufficient to fund cash needs. In particular, the definitions of Covenant Compliance EBITDA in the Senior Secured Credit Facility and the indenture allow us to add back certain non-cash, extraordinary, unusual or non-recurring charges that are deducted in calculating net earnings or loss. However, these are expenses that vary greatly and are difficult to predict. While EBITDA and Covenant Compliance EBITDA and similar measures are frequently used as measures of operations and the ability to meet debt service requirements, they are not necessarily comparable to other similarly titled captions of other companies due to the potential inconsistencies in the method of calculation.

Our ability to meet the covenants specified above in future periods will depend on events beyond our control, and we cannot assure you that we will meet those ratios. A breach of any of these covenants in the future could result in a default under, or an inability to undertake certain activities in compliance with, the Senior Secured Credit Facility and the indenture governing the 4.875% Senior Notes, at which time the lenders could elect to declare all amounts outstanding under the Senior Secured Credit Facility to be immediately due and payable. Any such acceleration would also result in a default under the indenture governing the 4.875% Senior Notes.

The following table provides a reconciliation from our net earnings to EBITDA and Covenant Compliance EBITDA for the three months ended March 30, 2014 and March 31, 2013, and the fiscal year ended December 29, 2013. The terms and related calculations are defined in the Senior Secured Credit Facility and the indenture governing the 4.875% Senior Notes.

(thousands of dollars)	Three months ended					Fiscal Year Ended
	March 30, 2014		March 31, 2013			December 29, 2013
Net earnings	$	40,748	$	24,796		$	89,349
Interest expense, net	24,341		40,653			132,213
Income tax expense	25,002		15,222			71,475
Depreciation and amortization expense	20,380		19,270			78,225
EBITDA	$	110,471	$	99,941		$	371,262
Non-cash items (a)	422		(404		)	5,620
Acquisition, merger and other restructuring charges (b)	2,203		4,018			22,137
Other adjustment items (c)	—		723			53,361
Adjusted EBITDA	113,096		104,278			$	452,380
Wish-Bone Acquisition adjustments (1)	3,000		18,071			54,716
Non-cash equity-based compensation charges (2)	2,112		175			7,933
Covenant Compliance EBITDA	$	118,208	122,524			515,029
Last twelve months Covenant Compliance EBITDA	$	510,713

(1) For the three months ended March 30, 2104, represents the net cost savings projected to be realized from acquisition synergies, calculated consistent with the definition of Covenant Compliance EBITDA. For fiscal 2013, represents proforma additional EBITDA from Wish-Bone for the period of fiscal 2013 prior to the Wish-Bone acquisition and the net cost savings projected to be realized from acquisition synergies, calculated consistent with the definition of Covenant Compliance EBITDA.

(2) Represents non-cash compensation charges related to the granting of equity awards.

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(a) Non-cash items are comprised of the following:

(thousands of dollars)	Three months ended					Fiscal Year Ended
	March 30, 2014		March 31, 2013			December 29, 2013
Unrealized losses (gains) resulting from hedging activities (1)	422		(404		)	(693		)
Effects of adjustments related to the application of purchase accounting (2)	—		—			6,313
Total non-cash items	$	422	$	(404	)	$	5,620

 _________________

(1) Represents non-cash gains and losses resulting from mark-to-market adjustments of obligations under derivative contracts.

(2) For fiscal fiscal year ended December 29, 2013, represents expense related to the write-up to fair market value of inventories acquired as a result of the Wish-Bone Acquisition.

(b) Acquisition, merger and other restructuring charges are comprised of the following:

(thousands of dollars)	Three months ended				Fiscal Year Ended
	March 30, 2014		March 31, 2013		December 29, 2013
Expenses in connection with an acquisition or other non-recurring merger costs (1)	$	—	$	339	$	9,485
Restructuring charges, integration costs and other business optimization expenses (2)	1,778		3,481		7,979
Employee severance (3)	425		198		4,673
Total acquisition, merger and other restructuring charges	$	2,203	$	4,018	$	22,137

_________________

(1) For the three months ended March 31, 2013, primarily represents IPO related expenses and due diligence investigations. For the fiscal year ended December 29, 2013, primarily represents costs related to the Wish-Bone acquisition, IPO related expenses and due diligence investigations.

(2) For the three monthsMarch 30, 2014, represents restructuring related charges related to the closure of our Millsboro, DE facility, and integration costs of the Wish-Bone acquisition and the Duncan Hines manufacturing business located in Centralia, Illinois. For the three months ended March 31, 2013, primarily represents restructuring and restructuring related charges related to the closure of our Millsboro, DE facility and consulting and business optimization expenses related to the expansion of headquarter direct sales coverage for retail. For the fiscal year ended December 29, 2013, primarily represents restructuring and restructuring related charges related to the closure of our Millsboro, DE facility, consulting and business optimization expenses related to the expansion of headquarter direct sales coverage for retail and a gain from the sale of our Tacoma, WA location in July 2013.

(3) Represents severance costs paid, or to be paid, to terminated employees.

(c) Other adjustment items are comprised of the following:

(thousands of dollars)	Three months ended				Fiscal Year Ended
	March 30, 2014		March 31, 2013		December 29, 2013
Management, monitoring, consulting and advisory fees (1)	$	—	$	723	$	19,181
Other (2)	—		—		34,180
Total other adjustments	$	—	$	723	$	53,361

_________________

(1) Represents management/advisory fees and expenses paid to an affiliate of Blackstone, including $15.1 million relating to the termination of the advisory agreement in connection with its terms.

(2) For the fiscal year ended December 29, 2013, primarily represents $34.2 million of the premiums paid on the redemption of $400.0 million of 8.25% Senior Notes due 2017.

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Our covenant requirements and actual ratios for the twelve months ended March 30, 2014 are as follows:

	Covenant Requirement	Actual Ratio
Senior Secured Credit Facility
Net First Lien Leverage Ratio (1)	5.75 to 1.00	3.92
Total Leverage Ratio (2)	Not applicable	4.61
Senior Notes (3)
Minimum Covenant Compliance EBITDA to fixed charges ratio required to incur additional debt pursuant to ratio provisions (4)	2.00 to 1.00	4.95

 _________________

(1) Pursuant to the terms of the Senior Secured Credit Facility, Pinnacle Foods Finance is required to maintain a ratio of Net First Lien Secured Debt to Covenant Compliance EBITDA of no greater than 5.75 to 1.00. Net First Lien Secured Debt is defined as Pinnacle Foods Finance's aggregate consolidated secured indebtedness secured on a first lien priority basis, less the aggregate amount of all unrestricted cash and cash equivalents.

(2) The Total Leverage Ratio is not a financial covenant but is used to determine the applicable margin rate under the Senior Secured Credit Facility. The Total Leverage Ratio is calculated by dividing consolidated total debt less the aggregate amount of all unrestricted cash and cash equivalents by Covenant Compliance EBITDA.

(3) Our ability to incur additional debt and make certain restricted payments under the indenture governing the 4.875% Senior Notes, subject to specified exceptions, is tied to a Covenant Compliance EBITDA to fixed charges ratio of at least 2.00 to 1.00.

(4) Fixed charges is defined in the indenture governing the 4.875% Senior Notes as (i) consolidated interest expense (excluding specified items) plus consolidated capitalized interest less consolidated interest income, plus (ii) cash dividends and distributions paid on preferred stock or disqualified stock.

Inflation

Historically, inflation did not have a significant effect on us as we had been successful in mitigating the effects of inflation with cost reduction and productivity programs. However inflation became more pronounced in 2011 and 2012, particularly in ingredient costs such as vegetables, flours, shortening/oils, beef, dairy, cocoa, corn sweeteners and energy. In the first half of 2013 the impact of inflation was lower than a year ago but was higher in the second half of 2013, the impact of which will flow through in the first half of 2014. To the extent possible, we offset inflation with productivity programs. However, we spend approximately $1.1 billion annually on ingredients, therefore each 1% change in our weighted average ingredient costs would increase our Cost of products sold by approximately $11.0 million. If we experience significant inflation, price increases may be necessary in order to preserve our margins and returns. Severe increases in inflation could have an adverse impact on our business, financial condition and results of operations.

Adjusted Gross Profit

Our management uses Adjusted Gross Profit as an operating performance measure. Adjusted Gross Profit is defined as gross profit before accelerated depreciation related to restructuring activities, certain non-cash items, acquisition, merger and other restructuring charges and other adjustments noted in the table below. We believe that the presentation of Adjusted Gross Profit is useful to investors because it is consistent with our definition of Adjusted EBITDA (defined above), a measure frequently used by securities analysts, investors and other interested parties in their evaluation of the operating performance of companies in industries similar to ours. In addition, we also use targets based on Adjusted Gross Profit as one of the components used to evaluate our management’s performance. Adjusted Gross Profit is not defined under GAAP, should not be considered in isolation or as substitutes for measures of our performance prepared in accordance with GAAP and is not indicative of gross profit as determined under GAAP.

The following table provides a reconciliation from our gross profit to Adjusted Gross Profit for the three months ended March 30, 2014 and March 31, 2013, and the fiscal year ended December 29, 2013.

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(thousands of dollars)	Three months ended					Fiscal Year Ended
	March 30, 2014		March 31, 2013			December 29, 2013
Gross profit	$	166,661	$	154,841		$	654,249
Non-cash items (a)	422		(404		)	5,620
Acquisition, merger and other restructuring charges (b)	1,555		1,789			4,504
Adjusted Gross Profit	$	168,638	$	156,226		$	664,373

(a) Non-cash items are comprised of the following:

(thousands of dollars)	Three months ended					Fiscal Year Ended
	March 30, 2014		March 31, 2013			December 29, 2013
Unrealized losses (gains) resulting from hedging activities (1)	422		(404		)	(693		)
Effects of adjustments related to the application of purchase accounting (2)	—		—			6,313
Non-cash items	$	422	$	(404	)	$	5,620

 _________________

(1) Represents non-cash gains and losses resulting from mark-to-market obligations under derivative contracts.

(2) For fiscal 2013, represents expense related to the write-up to fair market value of inventories acquired as a result of the Wish-Bone Acquisition.

(b) Acquisition, merger and other restructuring charges are comprised of the following:

(thousands of dollars)	Three months ended				Fiscal Year Ended
	March 30, 2014		March 31, 2013		December 29, 2013
Restructuring charges, integration costs and other business optimization expenses (1)	$	1,555	$	1,789	$	4,305
Employee severance and recruiting (2)	—		—		199
Total acquisition, merger and other restructuring charges	$	1,555	$	1,789	$	4,504

 _________________

(1) For the fiscal year ended December 29, 2013, primarily represents restructuring and restructuring related charges, consulting and business optimization expenses in connection with the closures at our Millsboro, DE (March 2012) and Fulton NY (March, 2012) facilities and a gain from the sale of our Tacoma, WA location in July 2013. For the three months ended March 30, 2014 primarily represents restructuring related charges related to the closure of our Millsboro, DE facility, and integration costs of the Wish-Bone acquisition and the Duncan Hines manufacturing business located in Centralia, Illinois. For the three months ended March 31, 2013, primarily represents restructuring and restructuring related charges, consulting and business optimization expenses in connection with the closures at our Millsboro, DE (March, 2013) and Fulton, NY (March, 2012) facilities.

(2) Represents severance costs paid or accrued to terminated employees.

Contractual Commitments

Our contractual commitments consist mainly of payments related to long-term debt and related interest, operating and capital lease payments, certain take-or-pay arrangements entered into as part of the normal course of business and pension obligations. Refer to the “Contractual Commitments” section of the Management's Discussion and Analysis of Financial Condition and Results of Operations in our Form 10-K filed with the SEC on March 6, 2014 for details on our contractual obligations and commitments.

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Off-Balance Sheet Arrangements

As of March 30, 2014, we did not have any off-balance sheet obligations.

Critical Accounting Policies and Estimates

We have disclosed in "Management Discussion and Analysis of Financial Condition and Results of Operations" included in our Form 10-K filed on March 6, 2014, those accounting policies that we consider to be significant in determining our results of operations and financial condition. There have been no material changes to those policies that we consider to be significant since the filing of our prospectus. We believe that the accounting principles utilized in preparing our unaudited consolidated financial statements conform in all material respects to GAAP.

ITEM 3:     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

FINANCIAL INSTRUMENTS

Risk Management Strategy

We are exposed to certain risks arising from both our business operations and economic conditions. We principally manage our exposures to a wide variety of business and operational risks through management of our core business activities. We manage economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of our debt funding and the use of derivative financial instruments. The primary risks managed by using derivative instruments are interest rate risk, foreign currency exchange risk and commodity price risk. Specifically, we enter into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates, foreign exchange rates or commodity prices. Please refer to Note 11 of the Consolidated Financial Statements "Financial Instruments" for additional details regarding our derivatives and refer to Note 9 of the Consolidated Financial Statements "Debt and Interest Expense" for additional details regarding our debt instruments. There were no significant changes in our exposures to market risk since December 29, 2013.

ITEM 4.CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed by us in our reports that we file or submit under the Exchange Act (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms, and that such information is accumulated and communicated to our management, with the participation of our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of March 30, 2014. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that the design and operation of our disclosure controls and procedures are effective at a level of reasonable assurance.

Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting (as defined in Rule 15d-15(f) of the Exchange Act) that occurred during the fiscal quarter ended March 30, 2014 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II

ITEM 1:LEGAL PROCEEDINGS

No material legal proceedings are currently pending.

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ITEM 1A:RISK FACTORS

Our risk factors are summarized under the“Risk Factors” section of our Form 10-K filed on March 6, 2014. There have been no material changes to our risk factors since the filing of that prospectus.

ITEM 2:UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None

ITEM 3:DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4:MINE SAFETY DISCLOSURES

None

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ITEM 5:OTHER INFORMATION

Rule 10b5-1 Plans

Our policy governing transactions in our securities by our directors, officers and employees permits such persons to adopt stock trading plans pursuant to Rule 10b5-1 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended. Our directors, officers and employees have in the past and may from time to time establish such stock trading plans. We do not undertake any obligation to disclose, or to update or revise any disclosure regarding, any such plans and specifically do not undertake to disclose the adoption, amendment, termination or explanation of any such plans.

Pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 (“ITRSHRA”), which added Section 13(r) of the Exchange Act, the Company hereby incorporates by reference herein Exhibit 99.1 of this report, which includes disclosures publicly filed and/or provided to Blackstone by Travelport Limited, which may be considered our affiliate.

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ITEM 6:     EXHIBITS

See the Exhibit Index immediately following the signature page hereto, which Exhibit Index is incorporated by reference as if fully set forth herein.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This report contains “forward-looking statements.” All statements, other than statements of historical facts included in this report, including statements concerning our plans, objectives, goals, strategies, future events, future revenues or performance, financing needs, plans or intentions relating to acquisitions, business trends and other information referred to under “Management's Discussion and Analysis of Financial Condition and Results of Operations” and “Note 12. Commitments and Contingencies” are forward-looking statements. When used in this report, the words “estimates,” “expects,” “contemplates”, “anticipates,” “projects,” “plans,” “intends,” “believes,” “forecasts,” “may,” “should” and variations of such words or similar expressions are intended to identify forward-looking statements. The forward-looking statements are not historical facts, and are based upon our current expectations, beliefs and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond our control. Our expectations, beliefs and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that management's expectations, beliefs and projections will result or be achieved and actual results may vary materially from what is expressed in or indicated by the forward-looking statements.

There are a number of risks, uncertainties and other important factors that could cause our actual results to differ materially from the forward-looking statements contained in this report. Such risks, uncertainties and other important factors include, among others, the risks, uncertainties and factors set forth in our Form 10-K filed with the SEC on March 6, 2014 under the section entitled “Risk Factors,” the section entitled “Management's Discussion and Analysis of Financial Condition and Results of Operations” in this report and the following risks, uncertainties and factors:

• competition;

• our ability to predict, identify, interpret and respond to changes in consumer preferences;

• the loss of any of our major customers;

• our reliance on single source provider for the manufacturing, co-packing and distribution of many of our products;

• fluctuations in price and supply of food ingredients, packaging materials and freight;

• volatility in commodity prices and our failure to mitigate the risks related to commodity price fluctuation and foreign exchange risk through the use of derivative instruments;

• costs and timeliness of integrating future acquisitions or our failure to realize anticipated cost savings, revenue enhancements or other synergies therefrom;

• our substantial leverage;

• litigation or claims regarding our intellectual property rights or termination of our material licenses;

• our inability to drive revenue growth in our key product categories or to add products that are in faster growing and more profitable categories;

• potential product liability claims;

• seasonality;

• the funding of our defined benefit pension plans;

• changes in our collective bargaining agreements or shifts in union policy;

• changes in the cost of compliance with laws and regulations, including environmental, worker health and workplace safety laws and regulations;

• our failure to comply with FDA, USDA or FTC regulations and the impact of governmental budget cuts;

• disruptions in our information technology systems;

• future impairments of our goodwill and intangible assets;

• difficulty in the hiring or the retention of key management personnel;

• changes in tax statutes, tax rates, or case laws which impact tax positions we have taken; and

• Affiliates of Blackstone beneficially own approximately 51% of our common stock.

You should evaluate all forward-looking statements made in this report in the context of these risks and uncertainties.

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We caution you that the risks, uncertainties and other factors referenced above may not contain all of the risks, uncertainties and other factors that are important to you. In addition, we cannot assure you that we will realize the results, benefits or developments that we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our business in the way expected. All forward-looking statements in this report apply only as of the date made and are expressly qualified in their entirety by the cautionary statements included in this report. We undertake no obligation to publicly update or revise any forward-looking statements to reflect subsequent events or circumstances.

ADDITIONAL INFORMATION AND WHERE TO FIND IT

This Form 10-Q does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. The proposed merger transaction involving Pinnacle and Hillshire will be submitted to the respective stockholders of Pinnacle and Hillshire for their consideration. In connection with the proposed merger, Pinnacle and Hillshire will prepare a registration statement on Form S-4 that will include a joint proxy statement/prospectus for the stockholders of Pinnacle and Hillshire to be filed with the SEC, and each will mail the joint proxy statement/prospectus to their respective stockholders and file other documents regarding the proposed transaction with the SEC. Pinnacle urges investors and stockholders to read the joint proxy statement/prospectus when it becomes available, as well as other documents filed with the SEC, because they will contain important information. Investors and security holders will be able to receive the registration statement containing the proxy statement/prospectus and other documents free of charge at the SEC’s web site, http://www.sec.gov.  These documents can also be obtained (when they are available) free of charge from Pinnacle upon written request to the Investor Relations Department, 399 Jefferson Road, Parsippany, New Jersey, 07054, telephone number (973) 434-2924, or from Pinnacle’ website, http://investors.pinnaclefoods.com.

Pinnacle, Hillshire and their respective directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies from the respective stockholders of Pinnacle and Hillshire in favor of the merger. Information regarding the persons who may, under the rules of the SEC, be deemed participants in the solicitation of the respective stockholders of Pinnacle and Hillshire in connection with the proposed merger will be set forth in the joint proxy statement/prospectus when it is filed with the SEC. You can find more information about Pinnacle’ executive officers and directors in its definitive proxy statement for its 2014 Annual Meeting of Stockholders, which was filed with the SEC on April 30, 2014. You can obtain free copies of these documents from Pinnacle using the contact information above.

Information regarding Pinnacle and Hillshire contained in this Form 10-Q is provided for the fiscal quarter ended March 30, 2014. Except as otherwise expressly noted herein, the information contained herein assumes that the proposed merger involving Pinnacle and Hillshire has not been consummated and does not describe or discuss the potential impact of the proposed merger on Pinnacle or its subsidiaries, business, operations, financial performance, or future prospects. Any such information will be contained only in the joint proxy statement/prospectus that may be filed with the SEC and, if so, may be obtained as described above. Readers are cautioned to read such documents carefully if and when they are filed.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

PINNACLE FOODS INC.

By:	/s/ Craig Steeneck
Name:	Craig Steeneck
Title:	Executive Vice President and Chief Financial Officer (Principal Financial Officer, Principal Accounting Officer and Authorized Officer)
Date:	May 14, 2014

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EXHIBIT INDEX

Exhibit Number	Description of exhibit
2.1	Agreement and Plan of Merger, dated as of May 12, 2014, between the Company and Hillshire Brands (previously filed as Exhibit 2.1 to the Current Report on Form 8-K of Pinnacle Foods Inc. filed with the SEC on May 12, 2014 (Commission File Number: 001-35844, and incorporated herein by reference)
3.1	Form of Amended and Restated Certificate of Incorporation of Pinnacle Foods Inc. (previously filed as Exhibit 3.1 to the Current Report on Form 8-K of Pinnacle Foods Inc. filed with the SEC on April 3, 2013 (Commission File Number: 001-35844, and incorporated herein by reference)
3.2	Form of Amended and Restated Bylaws of Pinnacle Foods Inc. (previously filed as Exhibit 3.2 to the Current Report on Form 8-K of Pinnacle Foods Inc. filed with the SEC on April 3, 2013 (Commission File Number: 001-35844, and incorporated herein by reference)
10.1+ *	Form of Restricted Stock Unit Agreement under 2013 Omnibus Incentive Plan.
10.2+ *	Form of Nonqualified Stock Option Agreement under 2013 Omnibus Incentive Plan.
10.3+ *	Form of Performance Share Unit Agreement under 2013 Omnibus Incentive Plan.
10.4	Voting Agreement, dated as of May 12, 2014, between the Blackstone Entities and Hillshire Brands (previously filed as Exhibit 10.1 to the Current Report on Form 8-K of Pinnacle Foods Inc. filed with the SEC on May 12, 2014 (Commission File Number: 001-35844, and incorporated herein by reference)
31.1*	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.
31.2*	Rule 13a-14(a)/15d-14(a) Certification of Executive Vice President and Chief Financial Officer.
32.1*	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (A)
32.2*	Certification of Executive Vice President and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (A)
99.1*	Section 13(r) Disclosure
101.1*	The following materials are formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Operations, (ii) the Consolidated Statements of Comprehensive Earnings, (iii) the Consolidated Balance Sheets, (iv) the Consolidated Statements of Cash Flows, (v) the Consolidated Statements of Shareholder’s Equity, (vi) Notes to Consolidated Financial Statements, and (vii) document and entity information. (B)

*    Identifies exhibits that are filed as attachments to this document.

+     Identifies exhibits that consist of a management contract or compensatory plan or arrangement.

(A) Pursuant to Commission Release No. 33-8212, this certification will be treated as “accompanying” this Form 10-Q and not “filed” as part of such report for purposes of Section 18 of Exchange Act, or otherwise subject to the liability of Section 18 of the Exchange Act and this certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.

(B) Pursuant to Rule 406T of Regulation S-T, the Interactive Data files on Exhibit 101.1 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 133, as amended, are deemed not file for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

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