EXHIBIT 10.1

 

Separation and Release Agreement

 

This Separation and Release Agreement (“Agreement”) is entered into by and
between emerald bioscience, Inc. (the “Company”) and Dr. Brian Murphy
(“Employee”), on August 7, 2020, with respect to the following facts:

 

RECITALS

 

 

A.

On October 2, 2014, Employee entered into an offer letter with the Company.

 

 

 

 

B.

Employee holds multiple positions in his employement with the Company, including
Chief Executive Officer and previously acted as the Chief Medical Officer.

 

 

 

 

C.

Employee is a member of the Company’s Board of Directors (the “Board”).

 

In consideration of the aforementioned recitals and the mutual covenants and
conditions set forth below and in full settlement of any and all claims arising
out of the Employee’s employment or the termination of that employment, the
Employee and Company hereby agree as follows:

 

AGREEMENT

 

 

1.

Resignation. Employee hereby resigns as Chief Executive Officer and member of
the Board and any other positions he holds with the Company as of August 7, 2020
(the “Termination Date”). According to the terms and conditions of that certain
Officer Change of Control Severance Plan (the”Plan”) dated February 2015,
Employee is entitled to certain severance payments so long as Employee executes
this Agreement. By execution hereof, Employee understands and agrees that this
Agreement is a compromise of doubtful and disputed claims, if any, which remain
untested; that there has not been a trial or adjudication of any issue of law or
fact herein; that the terms and conditions of this Agreement are in no way to be
construed as an admission of liability on the part of Releasees (as defined
below) and that Releasees deny liability and intend merely to avoid future
litigation.

 

 

 

 

2.

Separation Pay and Equity Acceleration. In consideration of Employee signing
this Agreement, and the covenants and releases given herein, the Company agrees
to, upon the Termination Date becoming effective, (a) pay Employee the aggregate
gross sum of $195,000.00, less federal and state withholdings, as salary
continuation over six months in accordance with the Company’s standard biweekly
payroll practice, and (b) continue the Company’s healthcare benefits (for
similarly situated executives as amended from time to time), for a period of six
months from the Termination Date (collectively, “Separation Pay”). Employee
acknowledges that Employee would not be entitled to receive the Separation Pay
absent this Agreement and the Plan. Each then-unvested Company stock option and
restricted stock award held by the Employee shall vest in full and, as
applicable, become exercisable on the Termination Date.

 

 

 

 

 

 

3.

General Release. Employee, individually and on behalf of Employee’s heirs,
assigns, executors, successors and each of them, hereby unconditionally,
irrevocably and absolutely releases and discharges the Company, each of its
subsidiaries and affiliates and each of their respective directors, officers,
employees, agents, successors and assigns, and any related corporations and/or
entities (“Releasees”) from any and all losses, liabilities, claims, demands,
causes of action or suits of any type, known or unknown, including but not
limited to claims related directly or indirectly to Employee's employment with
Releasees, and the termination of Employee's employment with Releasees,
including claims for age discrimination in violation of the Age Discrimination
and Employment Act and/or California Fair Employment and Housing Act, as well as
all claims for wrongful termination, constructive wrongful termination,
employment discrimination, harassment, retaliation, defamation, fraud,
misrepresentation, infliction of emotional distress, violation of privacy
rights, and any other claims under any state or federal law. This release also
includes any claim for any and all other contractual severance, bonus,
commission, other compensation or any other benefits pursuant to any other
agreement, policy, and/or procedure of the Company. Employee further represents
that Employee has not and will not institute, prosecute or maintain on
Employee’s own behalf, before any administrative agency, court or tribunal, any
demand or claim of any type related to the matters released herein.

 

 

 

 

 

Employee expressly waives all of the benefits and rights granted to Employee
pursuant to California Civil Code section 1542, and any other applicable state
or federal law. Section 1542 reads as follows:

 

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING
THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS
OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.

 

 

 

Employee certifies that Employee has read all of this Agreement, including the
release provisions contained herein and the quoted Civil Code section, and that
Employee fully understands all of the same.

 

 

 

 

4.

Confidentiality. Employee hereby agrees that, except as required by law or court
order, Employee will not describe or discuss the Company’s or any of its
subsidiaries’ business dealings and/or confidential information with any third
party, and will not describe or discuss this Agreement with any third party
other than Employee’s tax or legal advisors. Employee further agrees Employee
will comply with any continuing obligations under any employment agreement
and/or proprietary information agreement, including but not limited to
protection of the Company’s or its subsidiaries’ trade secrets and
nonsolicitation obligations.

 

 

 

 

 

5.

Non-disparagement.The Company and the Employee each agree that they will not
disparage or encourage others to disparage teach other. For purposes of this
agreement, the term disparage includes, without limitation, comments or
statements made in any matter or medium about the other Party which could
adversely affect the prospects or business reputation of the other Party, other
than such statements are required to be made by a regulatory body or court.

 

 

 

 

6.

Review.The Employee will have the opportunity to review and comment on the
Company’s News Release and the initial 10-K and 8-K disclosing the resignations
referred to herein and the Company will take his comments into consideration in
finalizing such disclosures.

 

 

 

 

7.

ADEA and OWBPA Waiver. Employee agrees that he is releasing any and all claims
for age discrimination under the Age Discrimination in Employment Act (“ADEA”),
the Older Workers Benefit Protection Act (“OWBPA”), and any federal, state or
local fair employment acts arising up to and through the date of his execution
of this Agreement. Employee further agrees that, (i) Employee is receiving
consideration beyond that which he otherwise would have been entitled to before
signing this Agreement; (ii) Employee is hereby advised to consult with an
attorney of his choice prior to the execution of this Agreement; (iii) Employee
has been given twenty-one (21) days from the date of receipt of this Agreement
to decide whether or not to execute it; and (iv) Employee has seven (7) days
from the execution of this Agreement to revoke its execution as to claims under
the ADEA, in which case this Agreement becomes null and void as to ADEA claims
if he elects revocation in that time. This Agreement is not effective until the
eighth day after Employee executes the Agreement, assuming he does not give
notice of revocation of this Agreement pursuant to the notice provisions herein
during the seven (7) day period that follows that execution. Employee
understands that the release in this Section 5 does not apply to rights and
claims that may arise after the date on which Employee signs this Agreement.

 

 

 

 

 

In the event that Employee chooses not to sign this Agreement, or chooses to
revoke this Agreement once signed, Employee will not receive the Separation Pay
or any other consideration Employee would be entitled to under this Agreement.

 

 

 

 

8.

Cooperation. In the event that the Company requires any information or testimony
from Employee in connection with the matter entitled, Emerald Bioscience,
Inc./Wendy Cunning, Case No. 9-3290-20-161 currently pending before OSHA, or any
other claim that might be brought by Ms. Cunning, or any other claim made
against the Company, or any claims made by the Company against persons or
entities not party to this Agreement, Employee agrees to cooperate fully with
and without cost to the Company, including: (a) appearing at any deposition,
trial, hearing or arbitration; (b) meeting telephonically or in person with
attorneys or agents designated by the Company, at a reasonable time and place
designated by the Company and prior to the giving of testimony, for the purpose
of discussing such testimony; and (c) providing the Company with any relevant
documentation in Employee’s custody, control or possession.

 

 

 

 

 

9.

General Provisions.

 

 

a.

Employee acknowledges that Employee has been given the opportunity to consult
with Employee’s own legal counsel with respect to the matters referenced in this
Agreement, and that Employee has obtained and considered the advice of such
legal counsel as they deem necessary or appropriate, such that they have
voluntarily and freely entered into this Agreement.

 

 

 

 

b.

This Agreement contains the entire agreement between Employee and the Company
and there have been no promises, inducements or agreements not expressed in this
Agreement.

 

 

 

 

c.

The provisions of this Agreement are contractual, not merely recitals, and shall
be considered severable, such that if any provision or part thereof shall at any
time be held invalid under any law or ruling, any and all such other
provision(s) or part(s) thereof shall remain in full force and effect and
continue to be enforceable.

 

 

 

 

d.

This Agreement may be pled as a full and complete defense and may be used as the
basis for an injunction against any action, suit, or proceeding that may be
prosecuted, instituted, or attempted by Employee in breach thereof.

 

 

 

 

e.

This Agreement shall be interpreted, construed, governed and enforced in
accordance with the laws of the State of California.

 

 

 

 

f.

This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective heirs, legal representatives, successors and
assigns.

 

 

 

 

g.

In any action to enforce this Agreement, the prevailing party shall be entitled
to recover all reasonable attorneys’ fees and costs it expended in the action.

 

 

 

 

h.

Nothing in this Agreement shall be construed as an admission or any liability or
any wrongdoing by any party to this Agreement.

 

 

 

 

i.

This Agreement shall not be construed against any party on the grounds that such
party drafted the Agreement.

 

 

 

 

j.

Each of the Company’s subsidiaries and affiliates shall be deemed to be a
third-party beneficiary of this Agreement.

 

 

 

 

 

k.

This Agreement is intended to comply with Section 409A of the Internal Revenue
Code of 1986, as amended (“Section 409A”), including the exceptions thereto, and
shall be construed and administered in accordance with such intent.
Notwithstanding any other provision of this Agreement, payments provided under
this Agreement may only be made upon an event and in a manner that complies with
Section 409A or an applicable exemption. Any payments under this Agreement that
may be excluded from Section 409A either as separation pay due to an involuntary
separation from service, as a short-term deferral, or as a settlement payment
pursuant to a bona fide legal dispute shall be excluded from Section 409A to the
maximum extent possible. For purposes of Section 409A, any installment payments
provided under this Agreement shall each be treated as a separate payment. To
the extent required under Section 409A, any payments to be made under this
Agreement in connection with a termination of employment shall only be made if
such termination constitutes a “separation from service” under Section 409A.
Notwithstanding the foregoing, the Company makes no representations that the
payments and benefits provided under this Agreement comply with Section 409A and
in no event shall the Company be liable for all or any portion of any taxes,
penalties, interest, or other expenses that may be incurred by Employee on
account of non-compliance with Section 409A

 

EMPLOYEE ACKNOWLEDGES AND AGREES THAT EMPLOYEE HAS FULLY READ, UNDERSTANDS, AND
VOLUNTARILY ENTERS INTO THIS AGREEMENT. EMPLOYEE ACKNOWLEDGES AND AGREES THAT
EMPLOYEE HAS HAD AN OPPORTUNITY TO ASK QUESTIONS AND CONSULT WITH AN ATTORNEY OF
EMPLOYEE’S CHOICE BEFORE SIGNING THIS AGREEMENT. EMPLOYEE FURTHER ACKNOWLEDGES
THAT THE EMPLOYEE’S SIGNATURE BELOW IS AN AGREEMENT TO RELEASE THE COMPANY FROM
ANY AND ALL CLAIMS THAT CAN BE RELEASED AS A MATTER OF LAW.

 

 

 

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of August
7, 2020.

 

EMERALD BIOSCIENCE, INC.

 

DR. BRIAN MURPHY

 

 

 

 

 

/s/ Punit Dhillon

 

/s/ Brian Murphy

 

Signature

 

Signature

 

 

 

 

 

Punit Dhillon

 

 

 

Name

 

 

 

 

 

 

 

Chairman

 

 

 

Title