Exhibit 99.1

SEPARATION AND CLAWBACK AGREEMENT

THIS SEPARATION AND CLAWBACK AGREEMENT(the “Agreement”), entered into on the 19th day of November, 2012 (the “Effective Date”), is between DIAMOND FOODS, INC., a Delaware corporation (the “Company”) and MICHAEL MENDES (the “Executive”).

In consideration of the mutual covenants undertaken and releases contained in this Agreement, Executive and the Companyhereby acknowledge and agree as follows:

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1. Separation. The Company and the Executive hereby agree that as of the EffectiveDate, Executive hereby resigns his employment with the Company, including all positions that the Executive holds with the Company or any of its subsidiaries or affiliates. The Executive agrees and acknowledges the amount of compensation and benefitsset forth in this Agreement is the amount of compensation and benefits to which he is entitled, including pursuant to his employment agreement dated March 25, 1997.

2. Clawback. As soon as practicable after the Effective Date, the Executive will deliver to the Company the following (the “Clawback”):

(a) a cash payment of $2,743,400, representing the total value of the Executive’s fiscal year 2010 and fiscal year 2011 bonuses(both the EPS bonus and MBO Goal Achievement bonus); and

(b) 6,665 shares of Company common stock, representing the vestedshares of Company common stock awarded to the Executive after fiscal year 2010.

With respect to the amount owed by theExecutive pursuant to Section 2(a), such amount will be deducted from the amount owed to the Executive pursuant to the Diamond Foods Retirement Restoration Plan (the “SERP”).

The Company and the Executive agree that under the terms of this Agreement, the Executive has returned to the Company any and all bonusesor other incentive-based or equity-based compensation received by the Executive from the Company during the entire period (which with respect to the Company’s fiscal year ending in 2010 exceeds 12 months) following the first public issuance orfiling (whichever first occurred) with the Securities and Exchange Commission (“SEC”) of the financial document embodying the financial reporting requirement with respect to which an accounting restatement was prepared. Furthermore, theExecutive represents that the Executive has not directly or indirectly sold or otherwise disposed of for pecuniary value any shares of Common Stock or other securities of the Company during the time period set forth in the preceding sentence.

3. Earned Compensation Through Effective Date and Vested Benefits Under Benefit Plans. The Executive and the Companyacknowledge and agree that the Executive’s unused accrued vacation, through the Effective Date of this Agreement is $175,655. By execution of this Agreement, the Executive acknowledges that this amount represents the Executive’s entireunused accrued vacation and the Executive waives any right that the Executive may have, including any rights pursuant to the terms of the Company’s vacation or PTO policy or plan, or otherwise, to contest the amount paid hereunder to theExecutive in full satisfaction of the Executive’s unused accrued vacation, the timing of such payment, or any other material term of such payment, all as set forth in this Section 3. The Executive and the Company further acknowledge andagree that with respect to the Executive’s vested benefits under the SERP, the amount payable to the Executive in connection with Executive’s separation from service is $5,440,000. By execution of this Agreement, the Executive acknowledgesthat this amount represents the entire benefit payable to the Executive under the SERP and the Executive waives any right that the Executive may have, including any rights pursuant to the terms of the SERP or otherwise, to contest the amount payableunder the SERP, the timing of such SERP payment, or any other material term of such SERP payment, all as set forth in this Section 3. Such amount shall be reduced by $2,743,400 in order to offset the Executive’s obligation pursuant toSection 2(a) herein. The Executive’s SERP benefit shall be paid to Executive on or about December 1, 2012, but in any event no later than December 7, 2012.

The Company agrees that Executive has repaid to the Company all financial objectives-basedcompensation determined to have been paid to the Executive in excess of the amount payable to the Executive had the financial data on which such financial objectives-based compensation not been in error, as described in greater detail in that Form10-K/A filed with the US Securities and Exchange Commission on November 28, 2011 (“Form 10-K/A”). Accordingly, the Company, with the intention of binding itself and its predecessors and successors, does hereby waive and releaseExecutive and his heirs, estate, executors, administrators and assigns (collectively, the “Employee Released Parties”), of and from any and all claims, actions, causes of action, complaints, charges and demands, based on the Company’sright to demand repayment of any amounts based on its agreement with the Executive as described in the Form 10-K/A. This release shall not include any proceeding as to which a release of claims is not permitted under applicable law, including anySEC investigation, or any claims for which approval of a court is required, regardless of the terms of this Agreement.

Nothing in this Agreement is intended to limit, waive or release Executive’s rights to be indemnified or advanced expenses and/or tobe entitled to insurance coverage as provided by the Company’s bylaws, articles of incorporation or, if greater, applicable state or federal laws.

Nothing herein shall be deemed, nor does anything contained herein purport, to be a waiver of any right or claim or cause of action which by law the Company is not permitted to waive.

Nothing in this Agreement is intended to limit any remedy of the Company or the Executive under the California Uniform Trade Secrets Act(California Civil Code Section 3426).

4. Treatment of Equity Awards. Any unvested restricted stock held by the Executiveshall be immediately forfeited and returned to the Company in accordance with the terms and conditions of the relevant equity plan. The Executive may exercise any options that have vested as of the Effective Date in accordance with their terms asapplicable to an employee whose employment has terminated on account of a resignation.

5. No Admission. This Agreement does notconstitute an admission of liability or wrongdoing of any kind by the Executive or the Company.

6. Restrictive Covenants. TheExecutive acknowledges and recognizes the highly competitive nature of the businesses of the Company and accordingly agrees that the Executive will continue to comply with any and all restrictive covenants protecting the Company to which theExecutive is contractually bound under any agreement, plan, policy, program or arrangement with or established by the Company, as the case may be, and in addition hereby agrees as follows:

A. Non-Solicitation. During the period commencing on the Effective Date and ending on the one-year anniversary of such date(the “Restricted Period”), the Executive shall not, directly or indirectly without the Company’s written consent, solicit or encourage any employee of the Company to leave his or her employment with the Company.

B. Severability and Reformation. It is expressly understood and agreed that, although the Executive and the Companyconsider the restrictions contained in Section 6.A above to be reasonable, if a judicial determination is made by a court of competent jurisdiction that the time or scope or any other restriction contained in Section 6.A or elsewhere

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