RKDA

Arcadia Biosciences, Inc. (RKDA) - 10-K Summary

Business Context and Reporting Period

This Annual Report on Form 10-K covers the fiscal year ended December 31, 2024. Arcadia Biosciences, Inc. is a science-based company focused on plant-based products. During 2024, the Company executed a strategic pivot, exiting its wheat-based food business (GoodWheat) and body care brands (Soul Spring, ProVault) to focus on its Zola coconut water brand and intellectual property monetization. As of December 31, 2024, the Company had 9 employees and operates primarily from Dallas, Texas.

Key Financial Metrics

Note: The 2024 Net Loss includes a $2.7 million loss from discontinued operations (GoodWheat). The 2023 Net Loss includes $7.8 million from GoodWheat and $0.8 million from Body Care discontinued operations.

Material Changes vs. Prior Period

• Asset Sales and Discontinued Operations:
  • Sold the GoodWheat brand to Above Food for net consideration of $3.7 million (received a $6.0 million promissory note and paid $2.0 million cash). This is reported as a discontinued operation.
  • Sold the non-GMO Resistant Starch (RS) durum wheat trait to Corteva Agriscience for $4.0 million cash, recognizing a $4.0 million gain on sale of intangible assets.
  • Exited body care brands (Soul Spring, ProVault) in Q3 2023 due to regulatory uncertainty in the CBD market.
• Revenue Growth: Total revenues increased 13% to $5.0 million, driven by a $1.3 million increase in Zola coconut water sales volume, partially offset by declines in GLA oil sales.
• Expense Reduction: Operating expenses decreased 18% to $8.7 million, primarily due to the $4.0 million gain on the wheat trait sale and the absence of the $6.1 million valuation loss on the March 2023 PIPE financing recorded in 2023.
• Warrant Liability: The change in fair value of common stock warrant and option liabilities resulted in a $1.5 million loss in 2024, compared to a $6.5 million gain in 2023.

Guidance, Outlook, Risks, and Contingencies

• Going Concern: The Company has raised substantial doubt about its ability to continue as a going concern. Management believes existing cash ($4.2 million) is insufficient to meet anticipated requirements for the next 12 months. Additional funding is required to continue operations.
• Proposed Business Combination: On December 4, 2024, Arcadia entered into an Exchange Agreement with Roosevelt Resources LP. Upon closing, Arcadia will issue shares to Roosevelt partners, who are estimated to own approximately 90% of the combined company. The transaction is subject to stockholder approval and other conditions. Failure to close could force the Company to seek liquidation or bankruptcy.
• Legal Proceedings:
  • Proposition 65 Litigation: A complaint was filed in March 2025 alleging violations of California's Proposition 65 regarding Bisphenol A (BPA) in Zola coconut water cans. The Company intends to vigorously defend the claims.
  • Shareholder Demand Letters: Following the filing of the S-4 registration statement for the Roosevelt transaction, the Company received demand letters alleging deficiencies in the proxy statement regarding financial projections and conflicts of interest.
• Intellectual Property: As of December 31, 2024, the Company owned or exclusively controlled 79 issued patents and 24 pending applications, primarily related to wheat traits.

Investor Verification Checklist

• Liquidity Runway: Verify the timeline for securing additional financing given the "substantial doubt" going concern warning and the $4.2 million cash balance.
• Roosevelt Transaction Status: Monitor the progress of the Exchange Agreement with Roosevelt Resources LP, including stockholder vote outcomes and regulatory approvals.
• Legal Exposure: Assess the potential financial impact of the Proposition 65 lawsuit regarding BPA in coconut water packaging.
• Warrant Liability Volatility: Review the fair value assumptions for the $2.7 million warrant and option liabilities, which significantly impact net income/loss.
• Discontinued Operations: Confirm the collection status of the $6.0 million promissory note received from Above Food for the GoodWheat sale.