We maintain a 401(k) retirement savings plan for the benefit of our employees, including Dr. Mack and Dr. Jalota, who satisfy certain eligibility requirements. Under the 401(k) plan, eligible employees may elect to defer a portion of their compensation, within the limits prescribed by the Code. The 401(k) plan is intended to qualify under Sections 401(a) and 501(a) of the Code. We do not provide for any matching contributions under the 401(k) plan.
Potential Payments upon Termination or Change in Control
Severance Policy. Drs. Mack and Jalota are each participants in our Severance Policy. We entered into amended and restated change in control and severance participation agreements with Dr. Mack in August 2020, and with Dr. Jalota, in January 2022, which supersede all previous arrangements we had previously entered into with our named executive officers. Under each of these agreements, if, within the period three months prior to and 12 months following a “change in control” (such period, the change in control period), we terminate the employment of the applicable named executive officer other than for “cause”, death or “disability” or the applicable named executive officer terminates his or her employment for “good reason” (as such terms are defined in the named executive officer’s change in control and severance agreement) and the named executive officer executes a separation agreement and release of claims that becomes effective and irrevocable within 60 days following the named executive officer’s termination, the named executive officer is entitled to receive (i) a lump sum severance payment, less applicable withholdings, equal to 100%, in the case of Dr. Jalota, and 150%, in the case of Dr. Mack, of their base salary, as then in effect, (ii) a lump sum payment, less applicable withholdings, equal to 100%, in the case of Dr. Jalota, and 150%, in the case of Dr. Mack, of their target bonus for the performance year in which such termination occurred, (iii) payment or reimbursement of premiums to maintain group health insurance continuation benefits pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) for the named executive officer and his or her dependents through 12 months, in the case of Dr. Jalota, and 18 months, in the case of Dr. Mack, following such termination, and (iv) accelerated vesting as to 100% of the employee’s outstanding unvested equity awards.
In addition, under each of these agreements, if, outside of the change in control period, we terminate the employment of the applicable named executive officer other than for cause, death or disability, and the named executive officer executes a separation agreement and release of claims that becomes effective and irrevocable within 60 days following the employee’s termination, the employee is entitled to receive (i) a lump sum severance payment, less applicable withholdings, equal to 9 months, in the case of Dr. Jalota, and 12 months, in the case of Dr. Mack, of their base salary, as then in effect, (ii) payment or reimbursement of premiums to maintain group health insurance continuation benefits pursuant to COBRA for the employee and the named executive officer’s dependents through 9 months, in the case of Dr. Jalota, and 12 months, in the case of Dr. Mack, following such termination, and (iii) accelerated vesting of time-based equity awards granted prior to the effective date of the first registration statement that is filed by the Company and declared effective pursuant to Section 12(b) of the Exchange Act, with respect to the Company’s common stock in an amount that would have vested had the named executive officer’s employment continued through 6 months, in the case of Dr. Jalota, and 12 months, in the case of Dr. Mack, following such termination.
Under each of these agreements, in the event any payment to, or benefits received by, the applicable employee pursuant to his or her change in control and severance agreement would be subject to the excise tax imposed by Section 4999 of the Code (as a result of a payment being classified as a parachute payment under Section 280G of the Code), the employee will receive such payment as would entitle the employee to receive the greatest after-tax benefit, even if it means that we pay him or her a lower aggregate payment so as to minimize or eliminate the potential excise tax imposed by Section 4999 of the Code.
2020 Equity Incentive Plan. Our 2020 Equity Incentive Plan (the “2020 Plan”) provides that in the event of a merger or change in control, as defined under our 2020 Plan, each outstanding award will be treated as the administrator determines, without a participant’s consent. The administrator is not required to treat all awards, all awards held by a participant or all awards of the same type similarly.
If a successor corporation does not assume or substitute for any outstanding award, then the participant will fully vest in and have the right to exercise all of his or her outstanding options and stock appreciation rights, all restrictions on restricted stock and restricted stock units will lapse, and for awards with performance-based vesting, unless specifically provided for otherwise under the applicable award agreement or other agreement or policy applicable to the participant, all performance goals or other vesting criteria will be deemed achieved at 100% of target levels and all other terms and