Exhibit 10.30

 

TRANSITION AGREEMENT AND LIMITED RELEASE      

                                                                                              

This Transition Agreement and Limited Release (“Limited Release”) is made by and
between Susan A. Knudson (“Executive”) and Pfenex Inc. (the “Company”)
(collectively, Executive and the Company referred to as the “Parties” or
individually referred to as a “Party”).

 

RECITALS

WHEREAS, Executive is employed by the Company as the Company’s Sr. Vice
President, Chief Financial Officer;

WHEREAS, Executive signed an Executive Employment Agreement with the Company on
January 3, 2018 (the “Employment Agreement”);

WHEREAS, Executive signed an At-Will Employment, Confidential Information,
Invention Assignment, and Arbitration Agreement with the Company on January 23,
2018 (the “Confidentiality Agreement”);

WHEREAS, the Company previously granted Executive options to purchase a total of
202,500 shares of the Company’s common stock (each, an “Option”) pursuant to the
terms and conditions of the Company’s 2014 Incentive Compensation Plan (the
“Plan”) and the individual award agreements thereunder (each, “Stock Option
Agreement” and together with the Plan, the “Equity Agreements”);

WHEREAS, Executive is resigning from her position as Sr. Vice President, Chief
Financial Officer of the Company and all other officer, manager, or executive
roles, without “Good Reason” (as defined in the Employment Agreement) effective
on November 13, 2019 (“CFO Resignation Date”);

WHEREAS, the Parties wish to resolve certain disputes, claims, complaints,
grievances, charges, actions, petitions, and demands that Executive may have
against the Company and any of the Releasees as defined below, including, but
not limited to, certain claims arising out of or in any way related to
Executive’s employment with or separation from the Company;

NOW, THEREFORE, in consideration of the mutual promises made herein, the Company
and Executive hereby agree as follows:

 

COVENANTS

 

1.

Consideration. In consideration of Executive’s entering into this Limited
Release and executing the resignation letter appended as Exhibit A prior to or
contemporaneously with Executive’s execution of this Limited Release, the
Company agrees as follows:

 

a.

Continued Employment; Transition Services. Commencing on the CFO Resignation
Date, Executive agrees to provide transition services to the Company through
February 1, 2020 (such period the “Transition Period,” with February 1, 2020
hereafter referred to as the “Planned Separation Date”). During the Transition
Period, the Company will continue to employ Executive as an at-will employee,
under the same benefits and base salary as in effect immediately prior to the
CFO Resignation

 

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Date, until no later than the Planned Separation Date (unless Executive’s
employment terminates sooner as discussed herein), except that Executive agrees
that Executive will no longer be the Company’s Sr. Vice President, Chief
Financial Officer or hold any managerial or executive role as of the CFO
Resignation Date. Nothing in this Limited Release shall in any way be construed
to alter the at-will nature of Executive’s employment with the Company during
the Transition Period. As a result, Executive is free to terminate Executive’s
employment at any time, for any reason or for no reason and the Company is free
to terminate Executive’s employment at any time, for any reason or for no reason
even before the Planned Separation Date. If Executive’s employment ends for any
reason before the Planned Separation Date, the Company shall only pay Executive
her earned salary up and through the last day worked, but no more. If
Executive’s employment ends as scheduled on the Planned Separation Date, the
Company shall only pay Executive her earned salary up and through the Planned
Separation Date, but no more. Regardless of whether Executive executes this
Limited Release, upon the date Executive’s employment terminates (whether on the
Planned Separation Date or earlier, for any reason), the Company will pay
Executive (i) all accrued but unused vacation earned up to the date Executive’s
employment terminates; and (ii) any reasonable and necessary, unreimbursed
business expenses incurred up to the date Executive’s employment terminates,
which are submitted to the Company, pursuant to the Company’s standard expense
reimbursement procedure.  

 

b.

Transition Services. Executive agrees that during the Transition Period,
Executive will assist the Company, in good faith, with transitioning Executive’s
responsibilities or such other non-executive and non-managerial services as the
Company may reasonably request, but in no way will Executive provide services as
an executive, officer, or manager of the Company. Nothing in this Limited
Release shall in any way be construed to allow Executive to bind the Company.
During the Transition Period, Executive may not work more than eight hours in a
day, 40 hours in a week, or six days in a row without mutual, prior, express,
written agreement with the Company.  

 

c.

Bonus Severance. If Executive remains employed by the Company through the
Planned Separation Date, and during such time provides competent transition
services (as determined by the Company in its sole discretion) as reasonably
requested by the Company, the Company agrees to pay to Executive an award under
the Pfenex Inc. Incentive Compensation Plan (the "Bonus Plan"). Such amount
shall have a target amount of thirty-five percent (35%) of the aggregate amount
of Executive's salary payments paid by the Company to Executive during 2019 and
further subject to the provisions of this paragraph and adjustment by the
Company’s Compensation Committee of its Board of Directors (the “Compensation
Committee”). The Bonus Severance amount will be determined based on achievement
of the performance goals under the Bonus Plan for the Company’s 2019 fiscal year
(the “2019 Performance Period”), which are corporate performance goals (weighted
80%) and individual performance goals (weighted 20%), except that the
Executive's individual performance goals, will be deemed achieved at one hundred
percent (100%), when calculating the Bonus Severance amount (collectively, the
"Bonus Severance"). The Bonus Severance will be paid in accordance with the
terms

 

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and conditions of the Bonus Plan following the 2019 Performance Period and no
later than February 28, 2020; provided that Executive continues to provide
competent transition services as reasonably requested by the Company through the
Transition Period. Executive acknowledges and agrees that unless she signs this
Limited Release, she would not otherwise be entitled to the cash award described
in this paragraph.

 

d.

Benefits. Executive’s participation in all benefits and incidents of employment,
including, but not limited to, vesting in stock options, and the accrual of
bonuses, vacation, and paid time off, will cease as of the Planned Separation
Date or, if Executive’s employment ends earlier, on the date her employment with
the Company ends.

 

e.

Acknowledgement. Executive acknowledges that without this Limited Release,
Executive is otherwise not entitled to the consideration listed in this section
1.

 

2.

Equity.  Except as amended by Section 1 of this Limited Release, each Option
that is outstanding and unexercised as of the CFO Resignation Date shall
continue to be subject to the terms of the Equity Agreements, including that
each Option shall continue to vest and remain exercisable during the Transition
Period and until the Planned Separation Date (unless Executive’s employment
terminates earlier), in accordance with the vesting schedule under the
applicable Equity Agreements. For avoidance of doubt, Parties agree that there
will be no break in service between the CFO Resignation Date and the date that
the Transition Period begins for purposes of Executive being considered a
Service Provider under the applicable Equity Agreements. Executive acknowledges
and agrees to continue to abide by the terms and conditions of the Company’s
Insider Trading Policy in accordance with its terms, including, without
limitation, the pre‑clearance procedures.

 

3.

Separation Agreement and Release. Upon the actual termination of Executive’s
employment whether on the Planned Separation Date or earlier, in exchange for
Executive’s execution of the Separation Agreement and Release attached hereto as
Exhibit B (the “Separation Agreement”) within the timeframe set forth in the
Separation Agreement (e.g. within twenty-one (21) days of Executive’s
termination/separation from employment but not earlier than the date Executive’s
employment actually terminates), the Company agrees to provide Executive with
the consideration and severance benefits set forth in Section 1 of the
Separation Agreement, subject to the terms and conditions of the Separation
Agreement. Executive acknowledges that without the Separation Agreement,
Executive is otherwise not entitled to the consideration and severance benefits
listed in section 1 of the Separation Agreement or any other post-employment
benefits, including, but not limited to, under the Employment Agreement or
Equity Agreements. Executive acknowledges and agrees that no payment or other
consideration provided under the Separation Agreement constitutes a raise, a
bonus, or continued employment and that the Separation Agreement is not a
condition of employment or continued employment. The Parties agree to modify the
Separation Agreement to comply with any new laws that become applicable prior to
the end of the Transition Period.

 

4.

Payment of Salary and Receipt of All Benefits. Executive acknowledges and
represents that, other than the consideration set forth in this Limited Release,
the Company has paid or

 

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provided all salary, wages, bonuses, accrued vacation/paid time off, premiums,
leaves, housing allowances, relocation costs, interest, outplacement costs,
fees, reimbursable expenses, commissions, stock, stock options, vesting, and any
and all other benefits and compensation due to Executive as of the Limited
Release Effective Date. On or before the CFO Resignation Date, the Company shall
pay or provide Executive all additional salary, wages, bonuses, accrued
vacation/paid time off, premiums, leaves, housing allowances, interest,
outplacement costs, fees, reimbursable expenses, and any and all other benefits
and compensation due to Executive as of the CFO Resignation Date.

 

 

5.

Release of Claims.  In exchange for the Consideration provided under this
Limited Release at Section 1, Executive agrees to release, with the exception of
any rights or claims Executive may have under the California Fair Employment and
Housing Act (the “FEHA”),  any and all claims Executive may have against the
Company and its current and former officers, directors, employees, agents,
investors, attorneys, shareholders, administrators, affiliates, benefit plans,
plan administrators, professional employer organization or co-employer,
insurers, trustees, divisions, subsidiaries, predecessor and successor
corporations, and assigns (collectively the “Releasees”) as of the date
Executive signs this Limited Release including, but not limited to, the
following: (a) claims arising under the federal or any state constitution; (b)
claims for breach of contract, breach of public policy, physical or mental harm
or distress; (c) any claim for attorneys’ fees and costs; (d) any and all claims
relating to, or arising from, Executive’s right to purchase, or actual purchase
of shares of stock of the Company; and (e) any and all other claims arising from
Executive’s employment relationship with the Company or the termination of that
relationship.  Executive agrees that, with respect to the claims released
herein, Executive will not file any legal action asserting any such claims and
has no lawsuits or other actions pending with respect to the claims released
herein.  Executive agrees that the release set forth in this section shall be
and remain in effect in all respects as a complete general release as to the
matters released.  This release does not extend to: (i) any obligations incurred
under this Limited Release; or (ii) claims that cannot be released as a matter
of law. Nothing herein releases any rights or claims Executive may have under
the FEHA.

 

6.

California Civil Code Section 1542.  Executive acknowledges that Executive has
been advised to consult with legal counsel and is familiar with the provisions
of California Civil Code Section 1542, a statute that otherwise prohibits the
release of unknown claims, which provides 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.

Executive, being aware of said code section, agrees to expressly waive any
rights Executive may have thereunder with respect to the claims released herein,
as well as under any other statute or common law principles of similar effect.

 

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7.

Trade Secrets and Confidential Information/Company Property.  Subject to the
Protected Activity provision, Executive acknowledges that, separate from this
Limited Release, Executive remains under continuing obligations to the Company
under the Confidentiality Agreement, specifically including the provisions
therein regarding nondisclosure of the Company’s trade secrets and confidential
and proprietary information. Executive specifically acknowledges and agrees that
any violation of the provisions of the Confidentiality Agreement governing the
non-disclosure and non-use of the Company’s trade secrets and proprietary and
confidential information, as well as the provisions regarding the Company’s
Inventions and return of Company property, shall constitute a material breach of
this Limited Release. Parties agree, however, that Section 8 of the
Confidentiality Agreement prohibiting the solicitation of Company employees will
not be enforced as to post-employment activities, and is considered removed from
the Confidentiality Agreement. Moreover, the Company will not enforce Section 11
of the Employment Agreement upon termination of Executive’s employment.

 

 

8.

Protected Activity Not Prohibited.  Executive understands that nothing in this
Limited Release shall in any way limit or prohibit Executive from engaging in
any Protected Activity. Protected Activity includes: (i) filing and/or pursuing
a charge, complaint, or report with, or otherwise communicating, cooperating, or
participating in any investigation or proceeding that may be conducted by any
federal, state or local government agency or commission, including the
Securities and Exchange Commission, the Equal Employment Opportunity Commission,
the Occupational Safety and Health Administration, and the National Labor
Relations Board (“Government Agencies”); and/or (ii) discussing the terms,
wages, and working conditions of employment, or disclosing
information  pertaining to sexual harassment or any unlawful or potentially
unlawful conduct in the workplace, as protected by applicable law. Executive
understands that in connection with such Protected Activity under prong (i) of
this section, Executive is permitted to disclose documents or other information
as permitted by law, without giving notice to, or receiving authorization from,
the Company. Notwithstanding the foregoing, Executive agrees to take all
reasonable precautions to prevent any unauthorized use or disclosure of any
information that may constitute the Company’s confidential information as set
forth in the Confidentiality Agreement, to any parties other than the Government
Agencies. Executive further understands that “Protected Activity” does not
include the disclosure of any Company attorney-client privileged communications
or attorney work product. Any language in the Confidentiality Agreement or the
Employment Agreement regarding Executive’s right to engage in Protected Activity
that conflicts with, or is contrary to, this section is superseded by this
Limited Release. In addition, pursuant to the Defend Trade Secrets Act of 2016,
Executive is notified that an individual will not be held criminally or civilly
liable under any federal or state trade secret law for the disclosure of a trade
secret that (i) is made in confidence to a federal, state, or local government
official (directly or indirectly) or to an attorney solely for the purpose of
reporting or investigating a suspected violation of law, or (ii) is made in a
complaint or other document filed in a lawsuit or other proceeding, if (and only
if) such filing is made under seal. In addition, an individual who files a
lawsuit for retaliation by an employer for reporting a suspected violation of
law may disclose the trade secret to the individual’s attorney and use the trade
secret information in the court proceeding, if the individual files any document
containing the trade secret under seal and does not disclose the trade secret,
except pursuant to court order.  

 

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9.

Governing Law.  This Limited Release shall be governed by the laws of the State
of California, without regard for choice-of-law provisions.  

 

10.

Severability and Counterparts. In the event that any provision or any portion of
any provision hereof or any surviving agreement made a part hereof becomes or is
declared by a court of competent jurisdiction or arbitrator to be illegal,
unenforceable, or void, this Limited Release shall continue in full force and
effect without said provision or portion of provision. This Limited Release may
be executed in counterparts and each counterpart shall be deemed an original and
all of which counterparts taken together shall have the same force and effect as
an original and shall constitute an effective, binding agreement on the part of
each of the undersigned.  The counterparts of this Limited Release may be
executed and delivered by facsimile, photo, email PDF, or other electronic
transmission or signature.

 

11.

Limited Release Effective Date.  Executive understands that this Limited Release
shall be null and void if not executed by Executive by November 13, 2019. This
Limited Release will become effective on the date it has been signed by both
Parties (the “Limited Release Effective Date”).

 

 

12.

Voluntary Execution of Limited Release.  Executive understands and agrees that
Executive executed this Limited Release voluntarily, without any duress or undue
influence on the part or behalf of the Company or any third party, with the full
intent of releasing Executive’s claims against the Company as set forth
herein.  

 

IN WITNESS WHEREOF, the Parties have executed this Limited Release on the
respective dates set forth below.

 

 

 

SUSAN A. KNUDSON, an individual

 

 

 

 

Dated:

November 13, 2019

/s/ Susan A. Knudson

 

 

Susan A. Knudson

 

 

 

 

 

 

 

 

 

 

PFENEX INC.

 

 

 

Dated:

November 13, 2019

By

/s/Evert B. Schimmelpennink

 

 

 

Evert B. Schimmelpennink

 

 

 

Chief Executive Officer

 

 

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EXHIBIT A OF LIMITED RELEASE

  

LETTER OF RESIGNATION

 

November 13, 2019

 

To the Board of Directors of Pfenex:

 

I hereby resign from any and all officer, managerial, and executive positions,
including as the Sr. Vice President, Chief Financial Officer of Pfenex Inc. (the
"Company") and as an officer of any subsidiaries of the Company effective as of
November 13, 2019 (the "CFO Resignation Date"). Following the CFO Resignation
Date, I will cease to represent myself as an officer or executive of the
Company, will not perform any managerial duties on behalf of the Company, and
will cease to be a signatory for, and to otherwise obligate, the Company.  

I also agree to execute any necessary documents or other forms necessary to
effectuate or document my resignation as a matter of local, state, federal or
international law.

 

Yours Truly,

/s/ Susan A. Knudson

Susan A. Knudson

 

 

 

 

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EXHIBIT B OF LIMITED RELEASE

 

SEPARATION AGREEMENT AND RELEASE

 

This Separation Agreement and Release (“Agreement”) is made by and between Susan
A. Knudson (“Executive”) and Pfenex Inc. (the “Company”) (collectively,
Executive and the Company referred to as the “Parties” or individually referred
to as a “Party”).

 

RECITALS

WHEREAS, Executive was employed by the Company;                        

WHEREAS, Executive signed an Executive Employment Agreement with the Company on
January 3, 2018 (the “Employment Agreement”);

WHEREAS, Executive signed an At-Will Employment, Confidential Information,
Invention Assignment, and Arbitration Agreement with the Company on January 23,
2018 (the “Confidentiality Agreement”);  

WHEREAS, the Company previously granted Executive options to purchase a total of
202,500 shares of the Company’s common stock (each, an “Option”) pursuant to the
terms and conditions of the Company’s 2014 Incentive Compensation Plan (the
“Plan”) and the individual award agreements thereunder (each, “Stock Option
Agreement” and together with the Plan, the “Equity Agreements”);

WHEREAS, Executive resigned from her position as Sr. Vice President, Chief
Financial Officer of the Company and all other officer, manager, or executive
roles, without “Good Reason” as defined in the Employment Agreement, effective
on November 13, 2019  (“CFO Resignation Date”);

WHEREAS, Executive signed a Transition Agreement and Limited Release with the
Company in connection with the transition of Executive’s services on November
13, 2019 (the “Limited Release”), which provided that Executive would remain an
at-will employee of the Company performing non-managerial, non-executive duties
through the Transition Period (as defined in “Limited Release”);

WHEREAS, Executive resigned from her employment with the Company and all
remaining roles as in effect during the Transition Period (as defined in the
Limited Release), such resignation being effective as of February 1, 2020 (the
“Separation Date”);  

WHEREAS, the Company is not within a Change of Control Period (as defined in the
Employment Agreement); and

WHEREAS, the Parties wish to resolve any and all disputes, claims, complaints,
grievances, charges, actions, petitions, and demands that Executive may have
against the Company and any of the Releasees as defined below, including, but
not limited to, any and all claims arising out of or in any way related to
Executive’s employment with or separation from the Company.

 

 

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NOW, THEREFORE, in consideration of the mutual promises made herein, the Company
and Executive hereby agree as follows:

COVENANTS

 

1.

Consideration.  In consideration of Executive’s execution and non-revocation of
this Agreement under the “Acknowledgment of Waiver of Claims under ADEA”
provision below, and in consideration of Executive’s fulfillment of all of the
Agreement’s terms and conditions, the Company agrees to the following:

 

a.

Severance Payment.  The Company agrees to pay Executive a total of Three Hundred
and Seventy-Five Thousand, Six Hundred and Ninety Dollars ($375,690), less
applicable withholdings (the “Severance Payment”) in accordance with the
Company’s regular payroll practices, by the end of the 61st day following the
Separation Date, so long as this Agreement is Effective and irrevocable by such
date. Parties acknowledge and agree that the Severance Payment equals (x) the
sum of (A) seventy-five percent (75%) of Executive’s base annual salary, as in
effect immediately prior to the Separation Date, plus (B) the sum of all
performance bonuses paid to Executive for the Company’s fiscal year immediately
preceding the fiscal year in which the Resignation Date occurred. Executive
acknowledges that the Company will issue a Form W-2 in connection with the
Severance Payment set forth in this Section and that the Severance Payment is
subject to applicable withholdings.  

 

b.

COBRA. The Company shall reimburse Executive for payments Executive makes for
COBRA coverage (at the coverage levels in effect immediately prior to the
Separation Date) until the earlier of: 1) a period of nine (9) months from the
Separation Date, or 2) the date upon which Executive and/or Executive’s eligible
dependents are no longer eligible for COBRA continuation coverage, whichever
occurs first, provided Executive timely elects and pays for continuation
coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985,
as amended (“COBRA”), within the time period prescribed pursuant to COBRA. COBRA
reimbursements shall be made by the Company to Executive consistent with the
Company’s normal expense reimbursement policy, provided that Executive submits
documentation to the Company substantiating Executive’s payments for COBRA
coverage.  

 

c.

Resignation. As Executive voluntarily resigned from Executive’s position as Sr.
Vice President, Chief Financial Officer as well as any and all managerial and
executive roles with the Company on the CFO Resignation Date (as defined in the
Limited Release), Executive hereby now voluntarily resigns from Executive’s
employment with the Company, including all remaining positions Executive held
with the Company and its affiliates during the Transition Period (as defined in
the Limited Release) effective on the Separation Date. Executive agrees to
execute any documentation deemed reasonably necessary by the Company to confirm
Executive’s resignation from employment with the Company.  Executive
acknowledges that while said resignation occurred in expectation of this
Agreement, Executive’s resignation itself shall not be considered a part of, or
a term

 

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or condition of, this Agreement, and that if the Executive subsequently revokes
this Agreement as provided for herein, said revocation does not affect or
nullify in any way Executive’s resignation and termination of employment.  

 

d.

No Further Severance and Acknowledgement. Except as explicitly set forth in this
section, Executive acknowledges and agrees that Executive is not entitled to
receive any severance benefits or other post-employment benefits from the
Company, including, but not limited to, under the Employment Agreement or the
Equity Agreements. Executive acknowledges and agrees that no payment or other
consideration provided herein constitutes a raise, a bonus, or continued
employment and that this Agreement is not a condition of employment or continued
employment. Executive hereby acknowledges that without this Agreement, Executive
is not otherwise entitled to the consideration listed in this Section 1.

 

2.

Equity.  The Parties agree that for purposes of determining the number of shares
of the Company’s common stock that Executive is entitled to purchase from the
Company, pursuant to the exercise of each Option, each Option will be considered
to have vested only up to the Separation Date. Executive acknowledges that as of
the Separation Date, Executive will have vested as to 86,500 shares subject to
the Options and no more. The exercise of the vested portion of the Options and
any shares acquired through such exercise shall continue to be governed by the
terms and conditions of the applicable Equity Agreements.

 

3.

Benefits.  Executive’s health insurance benefits shall cease on or before
February 28, 2020, subject to Executive’s right to continue Executive’s health
insurance under COBRA. Executive’s participation in all benefits and incidents
of employment, including, but not limited to, vesting in stock options, and the
accrual of bonuses, vacation, and paid time off, ceased as of the Separation
Date.

 

4.

Payment of Salary and Receipt of All Benefits.  Executive acknowledges and
represents that, other than the consideration set forth in this Agreement, the
Company has paid or provided all salary, wages, bonuses, accrued vacation/paid
time off, premiums, leaves, housing allowances, relocation costs, interest,
severance, outplacement costs, fees, reimbursable expenses, commissions, stock,
stock options, vesting, and any and all other benefits and compensation due to
Executive.

 

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5.

Release of Claims.  Executive agrees that the foregoing consideration represents
settlement in full of all outstanding obligations owed to Executive by the
Company and its current and former officers, directors, employees, agents,
investors, attorneys, shareholders, administrators, affiliates, benefit plans,
plan administrators, professional employer organization or co-employer,
insurers, trustees, divisions, subsidiaries, predecessor and successor
corporations, and assigns (collectively, the “Releasees”). Executive, on
Executive’s own behalf and on behalf of Executive’s respective heirs, family
members, executors, agents, and assigns, hereby and forever releases the
Releasees from, and agrees not to sue concerning, or in any manner to institute,
prosecute, or pursue, any claim, complaint, charge, duty, obligation, demand, or
cause of action relating to any matters of any kind, whether presently known or
unknown, suspected or unsuspected, that Executive may possess against any of the
Releasees arising from any omissions, acts, facts, or damages that have occurred
up until and including the date Executive signs this Agreement, including,
without limitation:

 

 

a.

any and all claims relating to or arising from Executive’s employment
relationship with the Company and the termination of that relationship;  

 

b.

any and all claims relating to, or arising from, Executive’s right to purchase,
or actual purchase of shares of stock of the Company, including, without
limitation, any claims for fraud, misrepresentation, breach of fiduciary duty,
breach of duty under applicable state corporate law, and securities fraud under
any state or federal law;

 

c.

any and all claims for wrongful discharge of employment, termination in
violation of public policy, discrimination, harassment, retaliation, breach of
contract (both express and implied), breach of covenant of good faith and fair
dealing (both express and implied), promissory estoppel, negligent or
intentional infliction of emotional distress, fraud, negligent or intentional
misrepresentation, negligent or intentional interference with contract or
prospective economic advantage, unfair business practices, defamation, libel,
slander, negligence, personal injury, assault, battery, invasion of privacy,
false imprisonment, conversion, and disability benefits;

 

d.

any and all claims for violation of any federal, state, or municipal statute,
including, but not limited to, Title VII of the Civil Rights Act of 1964, the
Civil Rights Act of 1991, the Rehabilitation Act of 1973, the Americans with
Disabilities Act of 1990, the Equal Pay Act, the Fair Labor Standards Act, the
Fair Credit Reporting Act, the Age Discrimination in Employment Act of 1967, the
Older Workers Benefit Protection Act, the Employee Retirement Income Security
Act of 1974, the Worker Adjustment and Retraining Notification Act, the Family
and Medical Leave Act, the Immigration Reform and Control Act, the National
Labor Relations Act, the California Family Rights Act, the California Labor
Code, the California Workers’ Compensation Act, and the California Fair
Employment and Housing Act (the “FEHA”);

 

e.

any and all claims for violation of the federal or any state constitution;

 

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f.

any and all claims arising out of any other laws and regulations relating to
employment or employment discrimination;

 

g.

any claim for any loss, cost, damage, or expense arising out of any dispute over
the nonwithholding or other tax treatment of any of the proceeds received by
Executive as a result of this Agreement; and

 

h.

any and all claims for attorneys’ fees and costs.

Executive agrees that the release set forth in this section shall be and remain
in effect in all respects as a complete general release as to the matters
released. This release does not extend to any obligations incurred under this
Agreement. This release does not release claims that cannot be released as a
matter of law. Any and all disputed wage claims that are released herein shall
be subject to binding arbitration in accordance with this Agreement, except as
required by applicable law. This release does not extend to any right Executive
may have to unemployment compensation benefits. This release supersedes the
release set forth at Section 5 of the Limited Release.

 

6.

Acknowledgment of Waiver of Claims under ADEA. Executive acknowledges that
Executive is waiving and releasing any rights Executive may have under the Age
Discrimination in Employment Act of 1967 ("ADEA"), and that this waiver and
release is knowing and voluntary. Executive agrees that this waiver and release
does not apply to any rights or claims that may arise under the ADEA after the
date Executive signs this Agreement. Executive acknowledges that the
consideration given for this waiver and release is in addition to anything of
value to which Executive was already entitled. Executive further acknowledges
that Executive has been advised by this writing that: (a) Executive should
consult with an attorney prior to executing this Agreement; (b) Executive has
twenty-one (21) days within which to consider this Agreement; (c) Executive has
seven (7) days following Executive’s execution of this Agreement to revoke this
Agreement; (d) this Agreement shall not be effective until after the revocation
period has expired; and (e) nothing in this Agreement prevents or precludes
Executive from challenging or seeking a determination in good faith of the
validity of this waiver under the ADEA, nor does it impose any condition
precedent, penalties, or costs for doing so, unless specifically authorized by
federal law. In the event Executive signs this Agreement and returns it to the
Company in less than the 21-day period identified above, Executive hereby
acknowledges that Executive has freely and voluntarily chosen to waive the time
period allotted for considering this Agreement. Executive acknowledges and
understands that revocation must be accomplished by a written notification to
the person executing this Agreement on the Company’s behalf that is received
prior to the Effective Date. The Parties agree that changes, whether material or
immaterial, do not restart the running of the 21-day period.

 

7.

California Civil Code Section 1542.  Executive acknowledges that Executive has
been advised to consult with legal counsel and is familiar with the provisions
of California Civil Code Section 1542, a statute that otherwise prohibits the
release of unknown claims, which provides as follows:

 

 

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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, WOULDHAVE MATERIALLY AFFECTED HIS
OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.

Executive, being aware of said code section, agrees to expressly waive any
rights Executive may have thereunder, as well as under any other statute or
common law principles of similar effect.

 

8.

No Pending or Future Lawsuits.  Executive represents that, with respect to the
claims released herein, Executive has no lawsuits, claims, or actions pending in
Executive’s name, or on behalf of any other person or entity, against the
Company or any of the other Releasees. Executive also represents that Executive
does not intend to bring any claims on Executive’s own behalf or on behalf of
any other person or entity against the Company or any of the other Releasees.

 

9.

Confidentiality.  Subject to the Protected Activity provision, Executive agrees
to maintain in complete confidence the existence of this Agreement or the
Limited Release, the contents and terms of this Agreement or the Limited
Release, and the consideration for this Agreement and the Limited Release
(hereinafter collectively referred to as “Separation Information”). Except as
required by law, Executive may disclose Separation Information only to
Executive’s immediate family members, the Court in any proceedings to enforce
the terms of this Agreement, Executive’s attorney(s), and Executive’s
accountant(s) and any professional tax advisor(s) to the extent that they need
to know the Separation Information in order to provide advice on tax treatment
or to prepare tax returns, and must prevent disclosure of any Separation
Information to all other third parties. Executive agrees that Executive will not
publicize, directly or indirectly, any Separation Information.

 

 

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10.

Trade Secrets and Confidential Information/Company Property.  Subject to the
Protected Activity provision, Executive acknowledges that, separate from this
Agreement, Executive remains under continuing obligations to the Company under
the Confidentiality Agreement, specifically including the provisions therein
regarding nondisclosure of the Company’s trade secrets and confidential and
proprietary information. Subject to the Protected Activity provision, Executive
agrees to observe and abide by the terms of the Confidentiality Agreement,
specifically including the provisions therein regarding nondisclosure of the
Company’s trade secrets and confidential and proprietary information. Subject to
the Protected Activity provision, Executive specifically acknowledges and agrees
that any violation of the provisions of the Confidentiality Agreement governing
the non-disclosure and non-use of the Company’s trade secrets and proprietary
and confidential information, as well as the provisions regarding the Company’s
Inventions and return of Company property, shall constitute a material breach of
this Agreement. Parties agree, however, that Section 8 of the Confidentiality
Agreement prohibiting the solicitation of Company employees will not be enforced
as to post-employment activities, and is considered removed from the
Confidentiality Agreement. Moreover, the Company will not enforce Section 11 of
the Employment Agreement upon termination of Executive’s employment. Executive’s
signature below constitutes Executive’s certification under penalty of perjury
that Executive has returned all documents and other items provided to Executive
by the Company (with the exception of a copy of the Employee Handbook and
personnel documents specifically relating to Executive), developed or obtained
by Executive in connection with Executive’s employment with the Company, or
otherwise belonging to the Company.  

 

11.

No Cooperation.  Subject to the Protected Activity provision, Executive agrees
that Executive will not knowingly encourage, counsel, or assist any attorneys or
their clients in the presentation or prosecution of any disputes, differences,
grievances, claims, charges, or complaints by any third party against any of the
Releasees, unless under a subpoena or other court order to do so or upon written
request from an administrative agency or the legislature or as related directly
to the ADEA waiver in this Agreement. Executive agrees both to immediately
notify the Company upon receipt of any such subpoena or court order or written
request from an administrative agency or the legislature, and to furnish, within
three (3) business days of its receipt, a copy of such subpoena or other court
order or written request from an administrative agency or the legislature. If
approached by anyone for counsel or assistance in the presentation or
prosecution of any disputes, differences, grievances, claims, charges, or
complaints against any of the Releasees, Executive shall state no more than that
Executive cannot provide counsel or assistance.

 

 

12.

Protected Activity Not Prohibited.  Executive understands that nothing in this
Agreement shall in any way limit or prohibit Executive from engaging in any
Protected Activity. Protected Activity includes: (i) filing and/or pursuing a
charge, complaint, or report with, or otherwise communicating, cooperating, or
participating in any investigation or proceeding that may be conducted by any
federal, state or local government agency or commission, including the
Securities and Exchange Commission, the Equal Employment Opportunity Commission,
the Occupational Safety and Health Administration, and the National Labor
Relations Board (“Government Agencies”); and/or (ii) disclosing information
pertaining to sexual harassment or any other unlawful or potentially unlawful
conduct in the workplace, to the extent protected by applicable law. Executive
understands that in connection with

 

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such Protected Activity under prong (i) of this section, Executive is permitted
to disclose documents or other information as permitted by law, without giving
notice to, or receiving authorization from, the Company. Notwithstanding the
foregoing, Executive agrees to take all reasonable precautions to prevent any
unauthorized use or disclosure of any information that may constitute the
Company’s confidential information under the Confidentiality Agreement, to any
parties other than the Government Agencies. Executive further understands that
“Protected Activity” does not include the disclosure of any Company
attorney-client privileged communications or attorney work product. Any language
in the Confidentiality Agreement or the Employment Agreement regarding
Executive’s right to engage in Protected Activity that conflicts with, or is
contrary to, this section is superseded by this Agreement. In addition, pursuant
to the Defend Trade Secrets Act of 2016, Executive is notified that an
individual will not be held criminally or civilly liable under any federal or
state trade secret law for the disclosure of a trade secret that (i) is made in
confidence to a federal, state, or local government official (directly or
indirectly) or to an attorney solely for the purpose of reporting or
investigating a suspected violation of law, or (ii) is made in a complaint or
other document filed in a lawsuit or other proceeding, if (and only if) such
filing is made under seal. In addition, an individual who files a lawsuit for
retaliation by an employer for reporting a suspected violation of law may
disclose the trade secret to the individual’s attorney and use the trade secret
information in the court proceeding, if the individual files any document
containing the trade secret under seal and does not disclose the trade secret,
except pursuant to court order.  

 

13.

Mutual Nondisparagement.  Subject to the Protected Activity provision above,
Executive agrees to refrain from any disparagement, defamation, libel, or
slander of any of the Releasees, and agrees to refrain from any tortious
interference with the contracts and relationships of any of the Releasees. The
Company agrees to refrain from any disparagement, defamation, libel, or slander
of  Executive. Executive understands that the Company’s obligations under this
section extend only to the Company’s current executive officers and members of
its Board of Directors and only for so long as each officer or member is an
employee or Director of the Company. Executive shall direct any inquiries by
potential future employers to the Company’s human resources department.

 

14.

Breach.  In addition to the rights provided in the “Attorneys’ Fees” section
below, Executive acknowledges and agrees that any material breach of this
Agreement, unless such breach constitutes a legal action by Executive
challenging or seeking a determination in good faith of the validity of the
waiver herein under the ADEA, shall entitle the Company immediately to recover
and/or cease providing the consideration provided to Executive under this
Agreement and to obtain damages, except as provided by law.

 

15.

No Admission of Liability.  Executive understands and acknowledges that with
respect to all claims released herein, this Agreement constitutes a compromise
and settlement of any and all actual or potential disputed claims by Executive
unless such claims were explicitly not released by the release in this
Agreement. No action taken by the Company hereto, either previously or in
connection with this Agreement, shall be deemed or construed to be (a) an
admission of the truth or falsity of any actual or potential claims or (b) an
acknowledgment or admission by the Company of any fault or liability whatsoever
to Executive or to any third party.

 

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16.

Costs.  The Parties shall each bear their own costs, attorneys’ fees, and other
fees incurred in connection with the preparation of this Agreement.

 

 

17.

ARBITRATION.  EXCEPT AS PROHIBITED BY LAW, THE PARTIES AGREE THAT ANY AND ALL
DISPUTES ARISING OUT OF THE TERMS OF THIS AGREEMENT, THEIR INTERPRETATION,
EXECUTIVE’S EMPLOYMENT WITH THE COMPANY OR THE TERMS THEREOF, OR ANY OF THE
MATTERS HEREIN RELEASED, SHALL BE SUBJECT TO ARBITRATION UNDER THE FEDERAL
ARBITRATION ACT (THE “FAA”) AND THAT THE FAA SHALL GOVERN AND APPLY TO THIS
ARBITRATION AGREEMENT WITH FULL FORCE AND EFFECT; HOWEVER, WITHOUT LIMITING ANY
PROVISIONS OF THE FAA, A MOTION OR PETITION OR ACTION TO COMPEL ARBITRATION MAY
ALSO BE BROUGHT IN STATE COURT UNDER THE PROCEDURAL PROVISIONS OF SUCH STATE’S
LAWS RELATING TO MOTIONS OR PETITIONS OR ACTIONS TO COMPEL ARBITRATION.
EXECUTIVE AGREES THAT, TO THE FULLEST EXTENT PERMITTED BY LAW, EXECUTIVE MAY
BRING ANY SUCH ARBITRATION PROCEEDING ONLY IN EXECUTIVE’S INDIVIDUAL CAPACITY.
ANY ARBITRATION WILL OCCUR IN SAN DIEGO COUNTY, BEFORE JAMS, PURSUANT TO ITS
EMPLOYMENT ARBITRATION RULES & PROCEDURES (“JAMS RULES”), EXCEPT AS EXPRESSLY
PROVIDED IN THIS SECTION. THE PARTIES AGREE THAT THE ARBITRATOR SHALL HAVE THE
POWER TO DECIDE ANY MOTIONS BROUGHT BY ANY PARTY TO THE ARBITRATION, INCLUDING
MOTIONS FOR SUMMARY JUDGMENT AND/OR ADJUDICATION, AND MOTIONS TO DISMISS AND
DEMURRERS, APPLYING THE STANDARDS SET FORTH UNDER THE CALIFORNIA CODE OF CIVIL
PROCEDURE. THE PARTIES AGREE that the arbitrator shall issue a written decision
on the merits. THE PARTIES ALSO AGREE THAT THE ARBITRATOR SHALL HAVE THE POWER
TO AWARD ANY REMEDIES AVAILABLE UNDER APPLICABLE LAW, AND THAT THE ARBITRATOR
MAY AWARD ATTORNEYS’ FEES AND COSTS TO THE PREVAILING PARTY, WHERE PERMITTED BY
APPLICABLE LAW. THE ARBITRATOR MAY GRANT INJUNCTIONS AND OTHER RELIEF IN SUCH
DISPUTES. THE DECISION OF THE ARBITRATOR SHALL BE FINAL, CONCLUSIVE, AND BINDING
ON THE PARTIES TO THE ARBITRATION. THE PARTIES AGREE THAT THE PREVAILING PARTY
IN ANY ARBITRATION SHALL BE ENTITLED TO INJUNCTIVE RELIEF IN ANY COURT OF
COMPETENT JURISDICTION TO ENFORCE THE ARBITRATION AWARD. THE PARTIES TO THE
ARBITRATION SHALL EACH PAY AN EQUAL SHARE OF THE COSTS AND EXPENSES OF SUCH
ARBITRATION, AND EACH PARTY SHALL SEPARATELY PAY FOR ITS RESPECTIVE COUNSEL FEES
AND EXPENSES; PROVIDED, HOWEVER, THAT THE ARBITRATOR MAY AWARD ATTORNEYS’ FEES
AND COSTS TO THE PREVAILING PARTY, EXCEPT AS PROHIBITED BY LAW. THE PARTIES
HEREBY AGREE TO WAIVE THEIR RIGHT TO HAVE ANY DISPUTE BETWEEN THEM RESOLVED IN A
COURT OF LAW BY A JUDGE OR JURY. NOTWITHSTANDING THE FOREGOING, THIS SECTION
WILL NOT PREVENT EITHER PARTY FROM SEEKING INJUNCTIVE RELIEF (OR ANY OTHER
PROVISIONAL REMEDY) FROM ANY COURT HAVING JURISDICTION OVER THE PARTIES AND THE
SUBJECT MATTER OF THEIR DISPUTE RELATING TO THIS

 

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AGREEMENT AND THE AGREEMENTS INCORPORATED HEREIN BY REFERENCE. SHOULD ANY PART
OF THE ARBITRATION AGREEMENT CONTAINED IN THIS SECTION CONFLICT WITH ANY OTHER
ARBITRATION AGREEMENT BETWEEN THE PARTIES, THE PARTIES AGREE THAT THIS
ARBITRATION AGREEMENT IN THIS SECTION SHALL GOVERN.

 

18.

Tax Consequences.  The Company makes no representations or warranties with
respect to the tax consequences of the payments and any other consideration
provided to Executive or made on Executive’s behalf under the terms of this
Agreement. Executive agrees and understands that Executive is responsible for
payment, if any, of local, state, and/or federal taxes on the payments and any
other consideration provided hereunder by the Company and any penalties or
assessments thereon. Executive further agrees to indemnify and hold the
Releasees harmless from any claims, demands, deficiencies, penalties, interest,
assessments, executions, judgments, or recoveries by any government agency
against the Company for any amounts claimed due on account of (a) Executive’s
failure to pay or delayed payment of federal or state taxes, or (b) damages
sustained by the Company by reason of any such claims, including attorneys’ fees
and costs. The Parties agree and acknowledge that the payments made pursuant to
section 1 of this Agreement are not related to sexual harassment or sexual abuse
and not intended to fall within the scope of 26 U.S.C. Section 162(q).

 

19.

Section 409A. It is intended that this Agreement comply with, or be exempt from,
Code Section 409A and the final regulations and official guidance thereunder
(“Section 409A”) and any ambiguities herein will be interpreted to so comply
and/or be exempt from Section 409A. Each payment and benefit to be paid or
provided under this Agreement is intended to constitute a series of separate
payments for purposes of Section 1.409A-2(b)(2) of the Treasury
Regulations.  The Company and Executive will work together in good faith to
consider either (i) amendments to this Agreement; or (ii) revisions to this
Agreement with respect to the payment of any awards, which are necessary or
appropriate to avoid imposition of any additional tax or income recognition
prior to the actual payment to Executive under Section 409A. In no event will
the Releasees reimburse Executive for any taxes that may be imposed on Executive
as a result of Section 409A.

 

20.

Authority.  The Company represents and warrants that the undersigned has the
authority to act on behalf of the Company and to bind the Company and all who
may claim through it to the terms and conditions of this Agreement. Executive
represents and warrants that Executive has the capacity to act on Executive’s
own behalf and on behalf of all who might claim through Executive to bind them
to the terms and conditions of this Agreement. Each Party warrants and
represents that there are no liens or claims of lien or assignments in law or
equity or otherwise of or against any of the claims or causes of action released
herein.

 

21.

Severability.  In the event that any provision or any portion of any provision
hereof or any surviving agreement made a part hereof becomes or is declared by a
court of competent jurisdiction or arbitrator to be illegal, unenforceable, or
void, this Agreement shall continue in full force and effect without said
provision or portion of provision.

 

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22.

Attorneys’ Fees.  Except with regard to a legal action challenging or seeking a
determination in good faith of the validity of the waiver herein under the ADEA,
in the event that either Party brings an action to enforce or effect its rights
under this Agreement, the prevailing Party shall be entitled to recover its
costs and expenses, including the costs of mediation, arbitration, litigation,
court fees, and reasonable attorneys’ fees incurred in connection with such an
action.

 

23.

Entire Agreement.  This Agreement represents the entire agreement and
understanding between the Company and Executive concerning the subject matter of
this Agreement and Executive’s employment with and separation from the Company
and the events leading thereto and associated therewith, and supersedes and
replaces any and all prior agreements and understandings concerning the subject
matter of this Agreement and Executive’s relationship with the Company, with the
exception of the Confidentiality Agreement, the Equity Agreements, and the
Limited Release, except as otherwise modified or superseded herein, and except
as inconsistent with this Agreement (in which case this Agreement governs and
supersedes).

 

24.

No Oral Modification.  This Agreement may only be amended in a writing signed by
Executive and the Company’s Chief Executive Officer.

 

 

25.

Governing Law.  This Agreement shall be governed by the laws of the State of
California, without regard for choice-of-law provisions, except that any dispute
regarding the enforceability of the arbitration section of this Agreement shall
be governed by the FAA. Executive consents to personal and exclusive
jurisdiction and venue in the State of California.  

 

26.

Effective Date.  Executive understands that this Agreement shall be null and
void if not executed by Executive within twenty-one (21) days of the Separation
Date (but must not be executed before the Separation Date). Each Party has seven
(7) days after that Party signs this Agreement to revoke it. This Agreement will
become effective on the eighth (8th) day after Executive signed this Agreement,
so long as it has been signed by the Parties and has not been revoked by either
Party before that date (the “Effective Date”).

 

27.

Counterparts.  This Agreement may be executed in counterparts and each
counterpart shall be deemed an original and all of which counterparts taken
together shall have the same force and effect as an original and shall
constitute an effective, binding agreement on the part of each of the
undersigned.  The counterparts of this Agreement may be executed and delivered
by facsimile, photo, email PDF, or other electronic transmission or signature.

 

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28.

Voluntary Execution of Agreement.  Executive understands and agrees that
Executive executed this Agreement voluntarily and without any duress or undue
influence on the part or behalf of the Company or any third party, with the full
intent of releasing all of Executive’s claims against the Company and any of the
other Releasees. Executive acknowledges that:

 

 

(a)

Executive has read this Agreement;

 

(b)

Executive has been represented in the preparation, negotiation, and execution of
this Agreement by legal counsel of Executive’s own choice or has elected not to
retain legal counsel;

 

(c)

Executive understands the terms and consequences of this Agreement and of the
releases it contains;  

 

(d)

Executive is fully aware of the legal and binding effect of this Agreement; and

 

(e)

Executive has not relied upon any representations or statements made by the
Company that are not specifically set forth in this Agreement.

  

IN WITNESS WHEREOF, the Parties have executed this Agreement on the respective
dates set forth below.

 

 

 

SUSAN A. KNUDSON, an individual

 

 

 

 

Dated:

________________, 20___

 

 

 

 

Susan A. Knudson

 

 

 

 

 

 

 

 

 

 

PFENEX INC.

 

 

 

 

Dated:

________________, 20___

By

 

 

 

 

Evert B. Schimmelpennink

 

 

 

Chief Executive Officer