Perquisites, Reimbursements and Other Benefits
Pursuant to Dr. Ghosh’s employment agreement, we provided to Dr. Ghosh reimbursement of up to $50,000 in relocation expenses, reimbursement of taxes incurred by him with respect to the foregoing, and a temporary housing allowance of $3,000 per month for his first year of employment and $2,000 per month for his second year of employment.
Pursuant to Mr. Leonard’s employment agreement, which was in effect in 2020 prior to his resignation as our Chief Executive Officer, we provided a monthly allowance of $7,500 for housing in the San Francisco Bay Area, where our principal offices are located. We also provided to Mr. Leonard reimbursement of commuting expenses to our principal offices and reimbursed certain taxes incurred by him in connection with our reimbursement of certain of his travel expenses.
We believe these benefits are reasonable and are intended to facilitate the applicable NEO’s relocation and/or accessibility to the business as required. Other than the benefits described above, we do not provide perquisites or other personal benefits to our NEOs.
Executive Compensation Arrangements
During 2020, we were party to employment agreements with each of our NEOs, which provide for base salaries, target cash incentives, benefit plan participation, as well as certain additional benefits, as described below.
Anirvan Ghosh, Ph.D.
We entered into an employment agreement with Dr. Ghosh in connection with his appointment as our Chief Executive Officer in March 2020, which sets forth his initial base salary, target bonus and new hire equity awards as described in the narrative above. In addition, pursuant to the employment agreement, Dr. Ghosh also received a sign-on bonus of $75,000, which was subject to repayment in the event of his termination for cause (as defined in the employment agreement) or resignation for any reason. Dr. Ghosh was also eligible to receive reimbursement of up to $50,000 in relocation expenses, reimbursement of taxes incurred by him with respect to the foregoing and a temporary housing allowance of $3,000 per month for his first year of employment and $2,000 per month for his second year of employment.
Under Dr. Ghosh’s employment agreement, in the event Dr. Ghosh is terminated without cause or resigns for good reason (as defined in the employment agreement), outside of a period of time that begins three months prior to and ends 18 months following a change in control, then Dr. Ghosh will be entitled to receive: (i) continued base salary for 12 months following the date of termination; and (ii) payment or reimbursement of continued healthcare coverage for up to 12 months following the date of termination, in each case, subject to his timely execution and delivery of a release of claims against the Company. In the event Dr. Ghosh is terminated without cause or resigns for good reason, during a period of time that begins three months prior to and ends 18 months following a change in control, Dr. Ghosh will be eligible to receive: (i) a lump sum severance payment equal to 1.5 times the sum of his base salary and target annual incentive payment; (ii) payment or reimbursement of continued healthcare coverage for up to 18 months following the date of termination; and (iii) the full accelerated vesting of his outstanding equity awards, in each case, subject to his timely execution and delivery of a release of claims against the Company.
In addition, in the event of a change in control, each of Dr. Ghosh’s equity awards will vest as to 50% of the then-unvested shares underlying the equity award and the remaining shares underlying the equity award will vest in substantially equal monthly installments over the 12 months immediately following the change in control, subject to Dr. Ghosh’s continued service to the Company or its successor through the applicable vesting date and subject to accelerated vesting as described above.
The employment agreement with Dr. Ghosh includes a “best pay” provision, pursuant to which, in the event any payment or benefit Dr. Ghosh would receive pursuant to the agreement or otherwise would be subject to an excise tax under Section 4999 of the Code, Dr. Ghosh would receive the greater of (i) the full amount of such payments and benefits or (ii) a reduced amount such that no portion is subject to an excise tax under Section 4999 of the Code, whichever is more favorable to Dr. Ghosh on an after-tax basis.
Keith R. Leonard Jr.
Pursuant to Mr. Leonard’s employment agreement, which was in effect during 2020 prior to his resignation as our Chief Executive Officer, in the event of a change in control of the Company, Mr. Leonard’s options outstanding as of the effective date of the employment agreement would vest except as to the lesser of (i) 6/48ths of the original