Exhibit 10.1

SEPARATION AND RELEASE AGREEMENT

 

This Separation and Release Agreement ("Agreement") is entered into by and
between RAJ KETKAR (“Ketkar” or “Employee”) on the one hand and ARCADIA
BIOSCIENCES, INC. (“Arcadia” or “Company”) on the other hand. The parties may
hereinafter be referred to individually as a "Party" or collectively as the
"Parties."

 

BACKGROUND

 

A.Ketkar is currently employed as the Chief Executive Officer of Arcadia
pursuant to that certain Employment Agreement dated May 23, 2016 (“Employment
Agreement”).

 

B.As part of his employment, Ketkar signed a Confidentiality and Invention
Assignment Agreement, dated May 23, 2016 (“CIA Agreement”) which remains in full
force and effect, and a Severance and Change In Control Agreement dated May 23,
2016 (“SCOC Agreement”) which had a three year term and expired on May 23, 2019.

 

C.Mr. Ketkar holds stock options that were granted pursuant to the Company’s
2015 Omnibus Equity Incentive Plan (“Plan”).  

 

D.Ketkar provided notice of his resignation from Arcadia on August 22, 2019, and
his resignation shall be effective September 1, 2019.

 

E.Arcadia desires to retain Ketkar as a consultant after the effective date of
his resignation and Ketkar desires to provide consulting services to Arcadia
pursuant to a separate consulting agreement to be entered into by the Parties.

 

For and in consideration of the mutual promises and covenants in this Agreement,
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the Parties agree as follows:

 

TERMS OF AGREEMENT

 

1.Separation.  Ketkar has resigned, and his employment with Arcadia shall end,
on September 1, 2019 (“Separation Date”).  As of the Separation Date, Ketkar has
resigned all positions he had or may have had with Arcadia including, but not
limited to, as a director, officer, manager, employee or agent of Arcadia or any
of its affiliates.

 

2.Accrued Salary and Vacation.  On the Separation Date the Company will pay
Ketkar all accrued salary, and all accrued and unused vacation earned through
the Separation Date, subject to all

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required payroll deductions and withholdings.  Ketkar is entitled to these
payments regardless of whether or not he signs this Agreement.

 

3.Consulting Agreement.  Arcadia agrees to retain Ketkar as a consultant for a
limited period commencing on the Separation Date, and continuing through
December 31, 2019, pursuant to the terms and conditions set forth in the
Consulting Agreement attached hereto as Exhibit A (“Consulting Agreement”).

 

4.Stock Options. Subject to the terms of this Agreement, if Ketkar does not
revoke acceptance of this Agreement or the releases contained herein, then on
the later of the Separation Date and the Effective Date, Mr. Ketkar will be
entitled to the benefits described in this Section 4.

 

a.

Ketkar holds options to purchase shares of the Company’s common stock
(“Options”) that were granted pursuant to the Plan, the rights of which Options
are set forth in stock option agreements for these Option (“Stock Option
Agreements”) and the Plan.  Each Option is described on Exhibit B.  The Options
that were granted to Ketkar in 2017, 2018 and 2019, and the Option to purchase
10,000 shares of common stock at an exercise price per share of $27.00 per share
that was granted to Ketkar on May 23, 2016, shall be referred to herein
collectively as the “Accelerated Vesting Options”.  The Options other than the
Accelerated Vesting Options shall be referred to herein as the “Non-Accelerated
Options.”

 

b.

As consideration for the releases contained herein and subject to the terms of
this Agreement, on the Separation Date the Company agrees to (i) cause the
Accelerated Vesting Options to vest with respect to all shares of the Company’s
common stock subject thereto and (ii) allow Ketkar to exercise vested
Accelerated Vesting Options until the second anniversary of the Separation Date,
or such earlier date as may be provided in the Plan and the applicable Stock
Option Agreements in circumstances other than the termination of Ketkar’s
employment with the Company (collectively, the “Option Amendments”).  Exhibit B
sets forth (i) the number of shares subject to each Option that are vested as of
the Separation Date and the (ii) the number of additional shares subject to each
Option that will vest on the Separation Date.  Ketkar understands that the
Non-Accelerated Options will terminate on the 90th day following the Separation
Date.

 

c.

The Parties agree that the Options will not vest as a result of Ketkar serving
as a consultant to the Company and that the Options will be vested only (i) to
the extent vested on the Separation Date and (ii) as provided in Section 4(b)
hereof with respect to the Accelerated Vesting Options.  Further, the Options
shall continue to be governed by the terms of the Stock Option Agreements and
the Plan, except as specifically modified by the terms of this Section 4.

 

d.

The Option Amendments shall be conditioned upon and subject to Employee’s
compliance with the obligations imposed by this Agreement, the Consulting
Agreement and the CIA Agreement.  Employee’s violation of this Agreement, the
Consulting Agreement or the CIA Agreement shall entitle the Company to terminate
the Option Amendments by written notice to Employee.

 

e.

Ketkar understands and agrees that to the extent that he is in position of
material nonpublic information about the Company or its business partners,
Ketkar may not trade the Company’s common stock until such information is
absorbed by the market following public announcement of it by the Company or
another authorized party, or until such time

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as the information is no longer material.  The foregoing restriction does not
apply to Ketkar’s exercise of the Options, but the sale of the stock issued upon
exercise of the Options is subject to the foregoing restrictions.

 

5.Health Insurance Benefits. Ketkar’s right to continue to participate in any of
the health insurance benefit plans and programs of Arcadia in effect as of the
Separation Date shall be determined according to the terms and provisions of
such programs and plans and applicable law.  To the extent provided by the
federal COBRA law or, if applicable, state insurance laws, and by the Company's
current group health insurance policies, Ketkar will be eligible to continue his
group health insurance benefits should he chose to do so and the Company will
provide him with a separate notice describing his rights and obligations under
COBRA.  Should Ketkar elect to continue health insurance benefits under COBRA,
Arcadia shall pay the premium payments for such benefits through the earlier of
December 31, 2019, or such time as Ketkar and/or his eligible dependents become
covered under another health insurance plan.  

 

6.Separation Payment.  In addition to the limited consulting arrangement Arcadia
is offering Ketkar as discussed in Section 3 of this Agreement, the Option
Amendments as discussed in Section 4 of this Agreement, and the COBRA premium
payments as discussed in Section 5 of this Agreement, the Company shall pay
Ketkar a one-time separation payment in the amount of Sixty One Thousand Six
Hundred Sixty Six Dollars ($61,666), which is equivalent to two months of his
base salary as of the Separation Date (“Separation Payment”).  The Separation
Payment shall be paid to Ketkar in the form of a gross lump sum payment on
December 31, 2019.  Ketkar shall be responsible for all federal, state, or local
taxes associated with the Separation Payment, and agrees to indemnify and hold
Arcadia harmless against any tax, penalty, claim, or assessment relating to the
Separation Payment.

 

7.Required Conditions for Issuance of Separation Benefits.  To be eligible to
receive the limited consulting arrangement, the Option Amendments, the COBRA
premium payments, and the Separation Payment as discussed in Sections 3-6 of
this Agreement (“Separation Benefits”) Ketkar must:

 

 

f.

Sign and return this Agreement to Arcadia within twenty-one (21) calendar days
from August 21, 2019 (which is the date the Agreement was provided to Ketkar for
review and consideration), and not revoke his acceptance once he signs the
Agreement.  Any negotiations or amendments made to the Agreement by the Parties
following August 21, 2019 shall not extend the twenty-one (21) calendar day
period.

 

 

g.

Support the internal and external messaging by Arcadia of his departure from the
Company which supports the employees and the business objectives of the Company.

 

 

h.

Comply with all terms and conditions under this Agreement, as well as under the
Consulting Agreement, and the CIA Agreement.

 

8.Other Compensation or Benefits.  Ketkar acknowledges that the Separation
Benefits are sufficient consideration provided to him in return for his
execution of this Agreement and that he was not otherwise entitled to such
Separation Benefits upon his separation of employment from Arcadia.

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Ketkar further acknowledges that, except as expressly provided in this
Agreement, he is not entitled to and will not receive, in connection with his
employment with Arcadia, any additional compensation, benefits or severance
after the Separation Date.  Thus, for any Company sponsored employee benefits
not referenced in this Agreement, Ketkar will be treated as a terminated
employee effective on the Separation Date.  

 

9.Expense Reimbursement.  Ketkar agrees that no later than five (5) days after
the Separation Date, he will submit any final documented expense reimbursement
statement reflecting all business expenses he incurred through the Separation
Date, if any, for which he seeks reimbursement.  The Company will reimburse
Ketkar for these expenses pursuant to its regular business practice.

 

10.Return of Company Property.  Ketkar agrees to immediately return to the
Company on the Separation Date, all Company documents (and all copies thereof)
and other Company property in his possession or control, including, but not
limited to, Company files, notes, drawings, memoranda, records, business plans
and forecasts, reports, proposals, personnel information, financial information,
specifications, computer-recorded information, tangible property (laptop
computer, cell phone, PDA, etc.), entry cards, identification badges and keys;
and, any materials of any kind that contain or embody any proprietary or
confidential information of the Company (and all reproductions thereof in whole
or in part). Ketkar agrees that he will make a diligent search to locate any
such documents, property and information on or before the Separation Date.  If
Ketkar has used any non-Company computer, hard drive, portable flash drive,
server, cellular telephone, iPhone, iPod, Blackberry, PDA, or e-mail system to
receive, store, review, prepare or transmit any Company confidential or
proprietary data, materials or information, he agrees to immediately provide the
Company with a computer-useable copy of such information and then permanently
delete and expunge such Company confidential or proprietary information from
those systems. Ketkar further agrees to provide the Company access to such
systems as requested to verify that the necessary copying and/or deletion is
completed.  By executing and returning this Agreement, Ketkar is certifying that
he will comply with his obligations herein to return all Company documents and
information regardless of where he has maintained such Company property.
Ketkar’s compliance with the terms of this Section is a condition precedent to
his eligibility to receive the Separation Benefits described above.

 

11.Continuing Obligation to Protect Company’s Proprietary Information. Ketkar
acknowledges that by reason of his position with Arcadia, he was, or may have
been, given access to confidential or proprietary information or materials
respecting Company’s business affairs, or the business affairs of the Company’s
customers, parent, subsidiaries, or affiliates.  Such confidential information
includes, but is not limited to, the Company’s business strategies, financial
results, human resource and personnel documentation, contractual agreements
between Company and other individuals or entities, strategies and ideas,
compilation of information and records which are owned by Company and which are
regularly used in operation of its business, procedures, written descriptions,
processes, research projects, protocols or other tangible items and
documentation, including computer programs, reports and marketing
information.  Ketkar represents that he has held all such information in
confidence and will continue to do so.  Ketkar further acknowledges and agrees
to comply with his continuing obligations under the CIA Agreement to refrain
from disclosing or using, for himself or another, any of the Company’s
proprietary trade secret information.

 

12.Non-Interference; Non-Solicitation.  To the fullest extent permitted by law,
Ketkar agrees not to unlawfully interfere with any of the Company's contractual
obligations or prospective business opportunities with others.  Furthermore,
Ketkar agrees not to:  (i) use any of the Company's

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confidential proprietary or trade secret information to contact, with the intent
to solicit or solicit the business of any client, customer, creditor, or
licensee of the Company; or (ii) during a period of two (2) years after the
later of the Effective Date of this Agreement and the Separation Date, take any
action to induce or solicit employees or independent contractors of the Company
to sever their relationship with Arcadia and accept an employment or an
independent contractor relationship with any other business.  Ketkar
acknowledges that this Section 12 is a reasonable and necessary measure designed
to protect the confidential proprietary and trade secret information of the
Company, as well as its employment and business relationships, and does not
prejudice Ketkar in his ability to work in his trade or profession.

 

13.Cooperation.  In the event that Arcadia or any of its affiliates becomes
involved in any legal action relating to events which occurred during Ketkar’s
employment with the Company, Ketkar shall cooperate with the Company to the
fullest extent possible in the preparation, prosecution, or defense of the
Company and/or its affiliate, including, but not limited to, the execution of
affidavits or documents, testifying, or providing information requested by
Arcadia or its affiliates, such assistance to be provided at the expense of the
Company or its affiliate.

 

14.Confidentiality.  The provisions of this Agreement, and any negotiations
regarding the Agreement, will be held in strictest confidence by Ketkar and will
not be publicized or disclosed in any manner whatsoever; provided; however, that
Ketkar may disclose this Agreement to: (a) his immediate family; (b) in
confidence to his attorneys, accountants, auditors, tax preparers, and financial
advisors; and (c) insofar as such disclosure may be necessary to enforce its
terms or as otherwise required by law.  In particular, and without limitation,
Ketkar agrees not to disclose the terms of this Agreement to any current or
former Company employee or independent contractor both during his review of the
Agreement and after his execution of the Agreement.

 

15.Non-disparagement.  Ketkar agrees that he will forever refrain from
disparaging the personal and/or professional reputation of the Company, or its
officers, directors, employees, shareholders, or agents, in any manner likely to
be harmful to it/them or its/their business, business reputation, or personal
reputation.  The Company agrees that it will not knowingly permit the
disparagement of Ketkar’s personal and/or professional reputation by any
employee who has been authorized to speak on behalf of the Company. However, the
Company has no control over, and will not be responsible for, the conduct of any
individual who has not been authorized to speak on behalf of the Company. Ketkar
understands and agrees that this covenant not to disparage applies to both
written and oral comments, as well as any comments posted on any social media or
other Internet site. This provision does not prevent the Parties from responding
accurately and fully to any question, inquiry or request for information when
required by legal process.

 

16.Release of Claims.  Except as otherwise set forth in this Agreement, Ketkar
hereby releases, acquits and forever discharges the Company and its owners,
officers, directors, shareholders, employees, agents, independent contractors,
members, executors, partners, joint venturers, administrators, parent,
subsidiaries, assigns, associates, affiliates, and attorneys, as well as all
persons or companies acting by, under, through or in concert with any of them
(the "Released Parties"), of and from any and all claims, liabilities, demands,
causes of action, costs, expenses, attorneys' fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise, known and
unknown, suspected and unsuspected, disclosed and undisclosed, arising out of or
in any way related to agreements, events, acts or conduct at any time prior to
and including the execution date of this Agreement, including but not limited
to: all such claims and demands directly or indirectly arising out of or in any
way connected with Ketkar’s employment with the Company or the separation of
that employment; claims or demands related to salary, vacation, fringe benefits,
expense reimbursements, separation pay, equity or stock, or any other form of

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compensation; claims pursuant to any federal, state or local law, statute, or
cause of action including, but not limited to, the federal Civil Rights Act of
1964, as amended; the federal Americans with Disabilities Act of 1990; the
federal Employee Retirement Income Security Act of 1974, as amended; the federal
Family and Medical Leave Act, as amended (the "FMLA"); the federal Age
Discrimination in Employment Act; the federal Older Workers Benefit Protection
Act; the Lilly Ledbetter Fair Pay Act; the California Fair Employment and
Housing Act, as amended; the California Family Rights Act, as amended; the
California Fair Pay Act; the California Labor Code; tort law; contract law;
wrongful discharge; discrimination; harassment; fraud; defamation; emotional
distress; and breach of the implied covenant of good faith and fair dealing
("Release").  This Release does not prohibit Ketkar from participating in an
Equal Employment Opportunity Commission ("EEOC") or other federal, state or
local administrative agency investigation or proceeding.  However, Ketkar agrees
to waive his right to monetary or other recovery should any claim be pursued
with the EEOC or administrative agency on his behalf arising out of or related
to his employment with and/or separation from the Company.  In addition, this
Release shall not be construed in any way to waive any rights or benefits that
may not be waived pursuant to applicable law.

 

17.No Actions or Claims. Ketkar represents that he does not have pending, and
will not file, in his name, or as a member of any class or representative
action, any charges, complaints, grievances, arbitrations, lawsuits, or claims
against the Released Parties, with any local, state or federal agency, union or
court.

 

18.Civil Code 1542 Waiver.  In granting the Release, Ketkar understands that
this Agreement includes a release of all claims known or unknown.  In giving his
Release, which includes claims which may be unknown to him at present, Ketkar
acknowledges that he or it has read and understands Section 1542 of the
California Civil Code which reads as follows: "A general release does not extend
to claims which the creditor or releasing party does not know or suspect to
exist in his or her favor at the time of executing the release, which if known
by him or her must have materially affected his or her settlement with the
debtor."  Ketkar hereby expressly waives and relinquishes all rights and
benefits under that section and any law of any jurisdiction of similar effect
with respect to the release of any unknown or unsuspected claims he may have
against the Released Parties.

 

 

19.

Voluntary Agreement. Ketkar understands, represents, and agrees as follows:

 

 

a.

In exchange for executing this Agreement, Ketkar is receiving separate
consideration beyond that which he is otherwise entitled to.

 

 

b.

By signing this Agreement, Ketkar is waiving, among other rights, all claims and
rights under the Age Discrimination in Employment Act ("ADEA") and the Older
Workers' Benefit Protection Act ("OWBPA"), 29 U.S.C. §621, et seq. Accordingly,
Ketkar understands that he has twenty one (21) days to consider this Agreement,
but need not take the full twenty one (21) day period if he does not wish to do
so.  If Ketkar signs this Agreement before the expiration of the twenty-one (21)
day period, he acknowledges and represents that he did so voluntarily.

 

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c.

Ketkar has seven (7) days to revoke his waiver under the ADEA and OWBPA after
signing this Agreement. For Ketkar’s revocation to be effective, he must give
written notice of his revocation to the Company (in care of, and addressed to,
the attention of the Company’s corporate counsel, Mike DeAngelis of Weintraub
Tobin Chediak Coleman Grodin, at the address listed in Section 24 of this
Agreement) prior to the expiration of the seven (7) day period (“Revocation
Period”).  Ketkar understands and acknowledges that if he revokes his acceptance
of this Agreement within the Revocation Period, he will not be entitled to, and
Arcadia will not be obligated to provide him with, any of the Separation
Benefits outlined in Sections 3-6 of this Agreement. In such circumstance, if
payments or benefits to Ketkar have already begun, Arcadia may immediately cease
any further payments or benefits.

 

 

d.

Ketkar acknowledges that: i) he has carefully read this Agreement; ii) he
understands its final and binding effect; iii) he has been advised, by the
language of this provision, of his right to consult with an attorney prior to
signing the Agreement; and iv) he understands the provisions of this Agreement
and knowingly and voluntarily agrees to be legally bound by them.

 

20.No Admission of Liability.  Each of the Parties acknowledges that neither
this Agreement, nor Arcadia’s granting of the Separation Benefits to Ketkar
pursuant to this Agreement, shall be taken or construed to be an admission or
concession of any kind with respect to any alleged liabilities, all of which are
expressly denied by the Parties.

 

21.Waiver of California Civil Code Section 1654.  Each of the Parties has had
the opportunity to obtain advice of legal counsel prior to the execution of this
Agreement, and understands fully the contents hereof.  Therefore, this Agreement
shall not be construed to have been drafted by any one Party and the Parties
expressly waive the provisions of California Civil Code §1654 to the extent that
it requires an ambiguity to be interpreted against the drafting party.

 

22.Attorney’s Fees. Each Party shall bear its/his own attorney’s fees in the
preparation and review of this Agreement. Should suit, action, or arbitration be
instituted to enforce any provision of this Agreement, the prevailing party
shall be entitled to recover its/his costs and reasonable attorney’s fees.

 

23.Compliance with IRC Section 409A.  To the extent IRC Section 409A should
apply to the payments and benefits provided to Ketkar under this Agreement, 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 Ketkar on account
of non-compliance with Section 409A.

 

24.Notices.  Any notice, consent, waiver, and other communication under this
Agreement shall be in writing, and any written notice or other document shall be
deemed to have been duly given and received (a) if mailed by registered or
certified mail, three business days after deposit in the United States mail,
postage prepaid, return receipt requested; (b) upon confirmation of a receipt of
a facsimile transmission; (c) if hand delivered, upon delivery against receipt
or upon refusal to accept the notice; (d) if delivered by a recognized overnight
courier, one business day after deposit with such courier, postage prepaid, in
each case, addressed to such Party at the address set forth below or at the most
recent address specified through written notice under this provision; or (e) if
delivered via email, upon confirmation of receipt.  Failure to conform to the
requirement that mailing be done by registered mail or certified mail

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shall not defeat the effectiveness of notice actually received by the addressee.
Unless otherwise provided for in this Agreement, notices should be sent to the
following addresses:

 

If to Ketkar:

 

[address]

 

If to Arcadia:

 

Arcadia Biosciences, Inc.

202 Cousteau Place, Suite 105

Davis, CA  95618

 

With a copy to Arcadia Corporate Counsel:

 

Mike DeAngelis

Weintraub Tobin Chediak Coleman Grodin

400 Capitol Mall, 11th Floor

Sacramento, California 95814

 

25.No Reliance upon Representations. Ketkar acknowledges that in executing this
Agreement, he has not relied upon any representation or statement made by
Arcadia or any Released Party with regard to the subject matter, basis or effect
of this Agreement.

 

26.Entire Agreement, Modification, Successors. Except as otherwise provided
herein, this Agreement contains the entire Agreement between the Parties hereto
with regard to the subject matters discussed herein and supersedes all prior
oral and/or written agreements if any. This Agreement may be modified only by
the further written agreement of the Parties. This Agreement will bind the
heirs, personal representatives, successors and assigns of the Parties, and
inure to the benefit of the Parties, and their heirs, successors and assigns.

 

27.Severability. If any part of this Agreement is determined to be illegal,
invalid or unenforceable, the remaining parts shall not be affected thereby and
the illegal, unenforceable or invalid part shall be deemed not to be part of
this Agreement.

 

28.Waiver.  Waiver by any Party of the breach of any provision of this Agreement
by the other Party will not operate or be construed as a continuing waiver.

 

29.Governing Law.  Any action to enforce this Agreement or any dispute
concerning the terms and conditions of this Agreement and a Party’s performance
of the terms and conditions of this Agreement, shall be governed by the laws of
the State of California.

 

30.Counterparts. This Agreement may be executed in duplicate originals, each of
which shall be deemed an original, and together shall constitute one Agreement.

 

31.Captions. All paragraph captions are for reference only and shall not be
considered in construing this Agreement.

 

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32.Effective Date. This Agreement shall become effective on the eighth (8th) day
following execution by Ketkar, provided Ketkar does not revoke the Agreement
before then (the "Effective Date").  Upon the Effective Date, the Parties hereto
agree to be bound by all of its terms and provisions of the Agreement.

 

 

 

 

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The Parties hereto have each duly executed this Separation and Release Agreement
as of the Signature Date set forth below.

 

 

 

Dated: August 23, 2019_/s/ RAJENDRA KETKAR__ _____

RAJ KETKAR

 

 

Dated: August 23, 2019ARCADIA BIOSCIENCES, INC.

 

 

 

By:__/s/KEVIN COMCOWICH_______________

 

 

Title:__Chairman of Board___________________

 

 

 

 

 

 

 

 

 

 

 

 

 

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[SIGNATURE PAGE TO SEPARATION AND RELEASE AGREEMENT]

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Exhibit A

 

CONSULTING AGREEMENT

 

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Exhibit B

 

STOCK OPTIONS

 

Grant Date

Shares Subject to Stock Options

Exercise Price Per Share

Vested Option Shares as of September 1, 2019

Additional Option Shares that will Vest Pursuant to Section 4(b)

5/23/2016

10,000

$27.00

8,333

1,667

5/23/2016

11,250

$120.00

9,375

0

5/23/2016

11,250

$160.00

9,375

0

5/23/2016

2,500

$240.00

2,083

0

5/23/2016

2,500

$300.00

2,083

0

6/8/2017

16,250

$14.00

9,141

7,109

9/18/2018

106,400

$4.63

50,983

55,417

6/3/2019

28,000

$5.04

0

28,000

Total

188,150

 

91,373

92,193