Company: CRNX
Filing Date: 2025-04-23
Form Type: DEF 14A
Source: 0000950170-25-057452
Chunk: 58

Company: Crinetics Pharmaceuticals, Inc.
Filing Date: 2025-04-23
Form: DEF 14A
Chunk 58
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Clawback Policy

We have adopted a compensation recovery policy that requires the recovery of certain erroneously-paid incentive compensation received by our Section 16 officers on or after October 2, 2023, as required by SEC rules and Nasdaq listing standards implemented pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act. Under this policy, if the Company is required to prepare an accounting restatement, the Company is also required to recover the amount of incentive-based compensation received by a current or former Section 16 officer that exceeds the amount such officer would have received based on the accounting restatement.

Tax and Accounting Considerations

Deductibility of Executive Compensation

The compensation committee considers certain tax implications when designing the Company’s executive compensation programs, including the deductibility of compensation paid to our named executive officers. Section 162(m) of the Internal Revenue Code generally limits the deductibility of compensation paid to certain executive officers in excess of $1 million during a year. The compensation committee believes that tax deductibility is only one of several relevant considerations in setting compensation, and that the tax deduction limitation should not be permitted to compromise the compensation committee’s ability to structure its compensation to attract, retain and appropriately motivate executive officers, thus providing benefits to the Company and its stockholders that outweigh the potential benefit of the tax deduction. Accordingly, the compensation committee has discretion to approve and authorize compensation that is not deductible for federal income tax purposes.

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Accounting for Stock-based Compensation Under Accounting Standards Codification 718 issued by the Financial Accounting Standards Board, or ASC 718, we are required to estimate the grant date “fair value” for each grant of equity award using various assumptions. This calculation is performed for accounting purposes and reported in the compensation tables below. ASC 718 also requires us to recognize the compensation cost of stock-based awards in our income statements over the period that an employee is required to render service in exchange for the award. Risk Assessment of Compensation Program In November 2024, management assessed our compensation program for the purpose of reviewing and considering any risks presented by our compensation policies and practices that are reasonably likely to have a material adverse effect on us. As part of that assessment, management reviewed the primary elements of our compensation program, including base salary, short-term incentive compensation and long-term incentive compensation. Management’s risk assessment included a review of the overall design of each primary element of our compensation program, and an analysis of the various design features, controls and approval rights in place with respect to compensation paid to