Item 5.02. Departure of Directors or Certain Officers; Election of
Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On May 20, 2020, Innoviva, Inc. (the “Company”) hired and appointed Pavel Raifeld as its new Chief Executive Officer, effective as of May 20, 2020. Mr. Raifeld
will succeed Geoffrey L. Hulme as the Company’s principal executive officer and will report directly to the Board of Directors of the Company.
In connection with his hiring, Mr. Raifeld and the Company entered into an offer letter (the “Offer Letter”) and a restrictive covenant agreement which contains,
among other things, customary non-competition, non-solicitation, confidentiality and invention assignment covenants. The Offer Letter provides for an initial base salary of $360,000 per year and annual bonus eligibility with an annual target payout
of 60% of his base salary.
In addition, Mr. Raifeld has been granted options (the “Options”) to purchase 250,000 shares of the Company’s common stock, subject to the terms and conditions of
the Company’s 2012 Equity Incentive Plan (the “Plan”) and a stock option agreement. 25% of the Options will vest on May 20, 2021 and the balance will vest in twelve (12) substantially equal installments thereafter on each three (3) month anniversary
of the initial vesting date, in each case, subject to Mr. Raifeld’s continuous service through the applicable vesting date, with accelerated vesting in the event that Mr. Raifeld experiences an “involuntary termination” (as defined in Mr. Raifeld’s
option agreement) within twenty-four (24) months following a “change in control” (as defined in the Plan).
Pursuant to the Offer Letter, if the Company terminates Mr. Raifeld’s employment without “cause” (other than due to his death or disability), the Company will,
subject to his execution of a general release of claims in favor of the Company, provide Mr. Raifeld (i) continued payment of his base salary during the six (6) month period immediately following the date of such termination, payable in accordance
with the Company’s regular payroll practices, and (ii) continued eligibility to receive a pro-rata bonus (based on the number of full months of employment completed in the year of termination) for the year of termination, subject to the terms and
conditions of the Company’s bonus program in effect at the time of termination (other than continued employment) including the achievement of any performance conditions, payable at the same time as bonuses are paid to active employees.
The foregoing description of the terms and conditions of the Offer Letter does not purport to be complete and is qualified in its entirety by reference to the
full text of the Offer Letter (including the restrictive covenant agreement), a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference in its entirety.
Prior to his appointment, Mr. Raifeld, CFA, age 37, served on the investment team at Sarissa Capital Management LP, an investment management firm focused on
improving strategies of companies to enhance shareholder value. Earlier, he was a senior member of the healthcare investment banking team at Credit Suisse Securities (USA) LLC. Previously, Mr. Raifeld worked as a consultant, primarily specializing
in advising biopharmaceutical companies, at McKinsey & Company, Inc. and The Boston Consulting Group Ltd. Mr. Raifeld earned an AB degree from Harvard University and an MBA degree from Columbia University.
There are no family relationships between Mr. Raifeld and any of the Company’s directors or executive officers, and there is no arrangement or understanding
between Mr. Raifeld or any other person and the Company or any of its subsidiaries pursuant to which he was appointed as an officer of the Company. There are no transactions between Mr. Raifeld or any of his immediate family members and the Company
or any of its subsidiaries that would be required to be reported under Item 404(a) of Regulation S-K.
Mr. Raifeld and the Company will also enter into an indemnification agreement requiring the Company to indemnify him to the fullest extent permitted by the
General Corporation Law of the State of Delaware with respect to his service as an officer of the Company. The indemnification agreement will be in substantially the form entered into with the Company’s other executive officers. This form of
indemnification agreement is attached hereto as Exhibit 99.1 to this Current Report on Form 8-K.
A copy of the press release announcing Mr. Raifeld’s appointment is attached hereto as Exhibit 99.2.
In connection with the hiring of Mr. Raifeld, the Company ended, effective as of the close of business on May 20, 2020, the employment of Mr. Hulme, who was
serving as the Company’s Interim Principal Executive Officer.