Item 5.02
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Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers;
Compensatory Arrangements of Certain Officers.
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On October 11, 2018, Portola Pharmaceuticals, Inc. (the Company) and
Scott Garland, President and Chief Executive Officer of the Company, entered into an Executive Severance Benefits Agreement (the Agreement). The Agreement provides that in the event of a termination by the Company without cause or a
termination by Mr. Garland for good reason, Mr. Garland would be eligible to receive salary continuance for a period of 15 months as severance. The Agreement also provides that in the event of an involuntary termination of
Mr. Garland, or a termination by Mr. Garland for good reason that occurs during the period three months before and 12 months following a change in control of the Company (called a Covered Termination Following a Change in
Control), Mr. Garland will be eligible to salary continuance for a period of 24 months as severance, as well as an amount equal to one twelfth of Mr. Garlands
Pro-Rated
Bonus (as defined
in the Agreement) multiplied by 24. In either case, Mr. Garland will also receive health insurance premiums under the Companys group health insurance plans as provided under COBRA, until the earliest of (i) the severance period of
either 15 or 24 months, as applicable, (ii) such time as Mr. Garland is eligible for health insurance coverage with a subsequent employer, and (iii) such time as Mr. Garland is no longer eligible for COBRA coverage. In addition,
in the event of a Covered Termination Following a Change in Control, all of Mr. Garlands outstanding options will be accelerated in full, and vesting will also accelerate for any stock or stock unit awards. Receipt of severance benefits
under the Agreement is subject to Mr. Garlands execution and nonrevocation of a waiver and release of claims in favor of the Company.
For
purposes of the Agreement, the term Change in Control means the occurrence of any of the following: (i) any natural person, entity or group within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934, as
amended, becoming the owner of more than 50% of the combined outstanding voting power of the Company; (ii) the consummation of a merger, consolidation or similar transaction involving the Company that results in the Companys stockholders
immediately prior to such transaction not owning more than 50% of the combined outstanding voting power of the surviving entity or the parent of such surviving entity; (iii) approval by the Companys stockholders or Board of Directors of a
plan of complete dissolution or liquidation of the Company, or a complete dissolution or liquidation of the Company; or (iv) the consummation of a sale, lease, license or other disposition of all or substantially all Company assets, with
certain exceptions.
For purposes of the Agreement, the term cause means any of the following: (i) the willful and material failure to
perform duties or follow lawful and reasonable directions following written notice of such failure from the Companys Board of Directors; (ii) conviction of a felony or a crime involving moral turpitude or dishonesty; (iii) willful
engagement in gross misconduct that is materially and demonstrably injurious to the Company; or (iv) material breach by Mr. Garland of the Companys standard Proprietary Information and Inventions Agreement.
For purposes of the Agreement, the term good reason means any of the following: subject to certain exceptions, (i) a decrease in total target
compensation of more than 10%; (ii) a material diminution of position, duties and responsibilities; (iii) an increase in Mr. Garlands round-trip driving distance of more than 50 miles from his principal personal residence to the
Companys principal business location; or (iv) the Companys failure to obtain a satisfactory agreement from any successor to assume and agree to perform under the material terms of the Agreement. Before Mr. Garland may terminate
employment for good reason, he must notify the Company in writing, the Company must fail to remedy or cure the alleged good reason and Mr. Garland must then terminate employment, all within prescribed time periods.
The foregoing description of the Agreement is a summary only and is qualified in its entirety by reference to the form of Agreement, which is attached hereto
as Exhibit 10.4 and is incorporated by reference herein.