Panera Bread® 2018 Animal Welfare Progress Update June 2019

Panera Bread has a firm commitment to maintain and improve our animal care standards. Even with integration of protein purchases by the newly acquired Au Bon Pain, we are pleased to report that we continue to achieve high performance year-on-year. In 2018, across both Panera and Au Bon Pain, 98% of the meats served on sandwiches and salads in our U.S. bakery-cafes met the company’s animal welfare requirements. This mirrors Panera Bread’s performance in 2017. This is equivalent to almost 58 million lbs., or 99%, of Panera’s meat supply and over 2 million lbs., or 81%, of Au Bon Pain’s supply.

The purchase of cage-free eggs across both Panera and Au Bon Pain has grown from almost 19 million in 2017, to over 22 million in 2018, a 15% increase, due to the higher volumes of eggs purchased in 2018. In addition, the company continues to innovate new plant-centric offerings to meet growing demand for plant-based meals.

An update on progress in each category is below. Please note that all figures pertain to U.S. bakery- cafes, or 96% of cafes globally:

Poultry: 2018 – 100% of poultry on sandwiches and salads is raised without antibiotics

• In 2018, across both Panera and Au Bon Pain, 100% of the chicken and turkey on our sandwiches and salads, equating to almost 47 million pounds, was raised without antibiotics and vegetarian fed. This is the same percentage as in 2017. • Panera continues to track the latest research on higher welfare broiler genetics and animal husbandry practices, as well as engage with leading animal welfare organizations, to inform our approach for improving broiler chicken welfare in the U.S. by 2024.

Pork: 2018 – 89% of pork served on sandwiches and salads was raised without antibiotics and was gestation crate free

• In 2018, 100% of Panera’s bacon, breakfast sausage and ham were raised without antibiotics and gestation crates for pregnant sows. This equates to almost 8.5 million pounds, or 92% of our total pork supply, up from 90% in 2017. • Over the same time period, 100% of Au Bon Pain’s bacon, breakfast sausage and ham were gestation crate free for pregnant sows. Additionally, 100% of its breakfast sausage was raised without antibiotics, while 100% of its ham and bacon was raised without the use of medically important antibiotics in alignment with FDA Guidance for Industry #209 and #213 on judicious use of antibiotics in livestock. • Across both entities, 89%, or over 8.5 million pounds, of pork served on sandwiches and salads was raised without antibiotics and was gestation crate free for pregnant sows.

Beef Cattle: 2018 – 98% of beef was grass fed and finished

• In 2018, 100% of Panera’s beef remained pasture raised, grass fed and finished. Over the same period, Au Bon Pain’s beef, which accounts for 2% of our beef purchases, was conventionally raised. • In total, 98% of our beef, or approximately 4.2 million pounds, was grass-fed, finished and free- range—down from 100% in 2017 due to the addition of conventionally raised Au Bon Pain supply.

Laying Hens (Eggs): 2018 – 14% of all eggs system-wide were cage-free

• In 2018, 28% of the 78 million shell eggs and egg whites used on sandwiches and salads in U.S. bakery-cafes were cage-free, up from 27% in 2017. This equates to 44% of the 50 million shell eggs we purchase each year. In addition, 100% of our hard-boiled eggs were cage-free. • The purchase of cage-free eggs across both Panera and Au Bon Pain has grown from almost 19 million in 2017, to over 22 million in 2018, a 15% increase due to the higher volumes of eggs purchased in 2018. Across the entire menu, 14% of the almost 156 million eggs used across the menu were cage-free, which remains the same as in 2017.

Plant-Centric Offerings: In 2018, Panera introduced several new plant-based items, including vegan versions of two broth bowls, our Soba Noodle Broth Bowl with Edamame, and Vegan Lentil Quinoa Broth Bowl. The Lentil Quinoa Broth Bowl is also available as a vegetarian dish when topped with a hard- boiled cage-free egg. In addition, we launched our first vegan whole grain sourdough bread, our Farmstyle Loaf.

We also began serving two new vegetarian menu items including our Modern Caprese Sandwich and Baja Mac and Cheese. We continue to innovate new offerings as guest demand for plant-centric and plant-based dishes (those containing no meat) grows.

Looking Forward: Given a number of changes to our business and unanticipated market factors, we would like to share updates on three key issues which impact animal welfare and our actions to address them:

Reconciling Standards: With the acquisition of Au Bon Pain, Panera Bread was suddenly faced with two different sourcing protocols and distinct supply chains. While the menus are similar, the ingredients are not identical nor produced by the same vendors. Fortunately, our approaches to animal welfare are similar, and the majority of Au Bon Pain’s supply is already in alignment with Panera’s standards.

Panera continues to work to integrate the remainder of the two operations’ supply chains and has plans to convert the ABP supply chain to our animal care standards. That said, this will take several years as we not only merge sourcing standards but also work to integrate and optimize our menus. We will continue to report progress toward the full transition.

Cage-Free Egg: Due to higher than expected market prices and our high food safety standards, we have modified our cage-free egg goal for our U.S. bakery-cafes to better support our business and our suppliers, and ensure we source within our food safety guidelines. We will continue to transition 100% of our eggs in our salads and sandwiches to cage-free by the end of 2020 per our original commitment. This accounts for approximately 50% of our eggs. We will also meet specific state requirements as mandated by law. Remaining eggs in our bakery and other menu items will be gradually transitioned by the end of 2025, similar to commitments by many others within the restaurant industry. Under this new approach, we will convert over 50 million eggs next year and continue to report annually on the progress of the remaining egg supply. Panera also remains committed to transitioning to cage-free eggs in all Panera Bread Canadian bakery-cafes by 2025.

Swine Flu: Over the course of the next few years, Panera Bread anticipates that African swine fever in Asia will drastically affect availability of all pork, including raised without antibiotic and gestation crate free pork in U.S. markets. We will continue to monitor the situation and alert guests to any changes in our supply that may occur.