ITEM 5.02. DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS

On December 14, 2012, Pacific Biosciences of California, Inc. (the "Company") entered into letter agreements with each of Michael Hunkapiller, the Company's Chairman, President and Chief Executive Officer, and Susan K. Barnes, the Company's Executive Vice President and Chief Financial Officer, to provide that Dr. Hunkapiller and Ms. Barnes will each receive a base salary of $1 per year commencing January 1, 2013 through December 31, 2013 (the "Salary Reduction"). Dr. Hunkapiller and Ms. Barnes also waived 100% of the amount of any bonus otherwise payable by the Company to them with respect to the calendar year 2012 performance period. For purposes of any salary severance that Dr. Hunkapiller and Ms. Barnes may be entitled to as a result of a change of control, such severance will be determined without regard to the Salary Reduction and instead will be calculated based on their respective base salaries in effect immediately prior to the effectiveness of the Salary Reduction.

The foregoing summary of the letter agreements does not purport to be complete and is qualified in its entirety by reference to the letter agreements filed herewith as exhibits to this Current Report on Form 8-K.

ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS.

(d) Exhibits.

10.1 Letter Agreement between the Company and Michael Hunkapiller, dated December 14, 2012

10.2 Letter Agreement between the Company and Susan K. Barnes, dated December 14, 2012

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