Exhibit 10.1

 

ALLOS THERAPEUTICS, INC.

 

ANNUAL INCENTIVE PLAN

 

1.             Purpose of the Plan.  The purpose of the Allos Therapeutics, Inc.
Annual Incentive Plan (the “Plan”) is to promote the interests of the Company
and its stockholders by rewarding Company employees based upon the level of
achievement of financial, business and other performance objectives established
in accordance with this Plan.

 

2.             Definitions.  As used in the Plan, the following terms shall have
the meanings set forth below:

 

(a)           “Allos” or the “Company” shall mean Allos Therapeutics, Inc.

 

(b)           “Base Salary” in respect of any Plan Year shall mean the
cumulative actual base salary and, in the case of a Non-Exempt Employee, any
overtime pay, received by a Participant during the Plan Year.

 

(c)           “Board” shall mean the Board of Directors of the Company.

 

(d)           “Bonus” shall mean a cash payment made pursuant to the Plan.

 

(e)           “Code” means the Internal Revenue Code of 1986, as amended from
time to time.

 

(f)            “Committee” shall mean the Compensation Committee of the Board,
or any successor thereto or any other committee designated by the Board to
assume the obligations of the Committee hereunder.

 

(g)           “Non-Exempt Employee” shall mean a Company employee who is not
exempt from the minimum wage and overtime requirements of The Fair Labor
Standards Act of 1938, as amended.

 

(h)           “Officer” shall mean a Participant who is an officer of the
Company within the meaning of Section 16 of the Securities Exchange Act of 1934,
as amended, and the rules and regulations promulgated thereunder.

 

(i)            “Participant” shall mean an employee of the Company who is
eligible to participate in the Plan pursuant to Section 4 hereof.

 

(j)            “Plan Year” shall mean the twelve-month period from January 1
through December 31.

 

3.             Administration.  The Plan shall be administered by the Committee
or such other persons designated by the Board.  The Committee is authorized to
interpret the Plan, to establish, amend and rescind any rules and regulations
relating to the Plan, and to make any other determinations that it deems
necessary or desirable for the administration of the Plan; provided, however,
that any action permitted to be taken by the Committee may be taken by the
Board, in its discretion.  The Committee may correct any defect or omission or
reconcile any inconsistency in the Plan in the manner and to the extent the
Committee deems necessary or desirable.  Any decision of the Committee in the
interpretation and administration of the Plan, as described herein, shall lie
within its sole and absolute discretion and shall be final, conclusive and
binding on all parties concerned.  The Committee may delegate to one or more
employees of the Company the authority to take actions on its behalf pursuant to
the Plan.

 

4.             Eligibility.  Allos employees of regular status who are scheduled
to work a minimum of 30 hours per week are eligible to participate in the Plan. 
To receive a Bonus, an employee must have entered into Plan eligibility prior to
October 1st of the applicable Plan Year and must be on the Company’s payroll on
the last day of the applicable Plan Year.  In addition, the employee must
receive at least a “Successful” rating on the

 

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employee’s performance review for the Plan Year and not be subject to a formal
performance improvement plan at the time bonus determinations are made.

 

5.             Determination and Weighting of Objectives.  Bonus awards for each
Plan Year shall be determined based on the level of achievement of corporate and
individual objectives established pursuant to this Section 5.

 

(a)           Corporate Objectives.  Prior to the beginning of each Plan Year,
the President and CEO will develop a list of corporate objectives for the Plan
Year, which shall be subject to the approval of the Board.  The corporate
objectives shall include such financial, business and other performance
objectives as the Board may, in its sole discretion, approve.

 

(b)           Individual Objectives.  After approval of the corporate
objectives, the Company, in conjunction with the Participants, will develop
individual objectives for the Plan Year that are consistent with and support the
corporate objectives or are otherwise intended to contribute to the success of
the Company.  Individual objectives for each Participant will vary. In some
cases, individual objectives may be based on a Participant’s job description and
assessed in connection with such Participant’s annual performance review for the
applicable Plan Year.  Participants at the “Director” level and above should
expect that the Company will request the Participant to develop specific written
objectives for the Plan Year, which will be subject to the approval of the
Participant’s responsible Vice President (or other immediate supervisor) and the
President and CEO.

 

(c)           Weighting of Objectives.  Bonus awards for each Participant shall
be weighted between corporate objectives and individual objectives based on the
Participant’s position within the organization.  The weighting will be reviewed
annually and may be adjusted by the Committee, as necessary or appropriate.  The
weighting for 2006 will be as follows:

 

Position

 

Corporate

 

Individual

 

President and CEO

 

100

%

—

 

Senior Vice President

 

100

%

—

 

Vice President

 

75

%

25

%

Senior Director

 

50

%

50

%

Director

 

40

%

60

%

Associate Director

 

40

%

60

%

Grades 8 and above

 

25

%

75

%

Grades 5-7

 

25

%

75

%

Grades 1-4

 

25

%

75

%

 

6.             Target Award Multipliers.  Target Bonus awards for each
Participant will be determined by applying a “target award multiplier” to the
Participant’s Base Salary.  The target award multipliers will be reviewed
annually and may be adjusted by the Committee, as necessary or appropriate.  The
target award multipliers for 2006 will be as follows:

 

Position

 

Target Award
Multiplier

 

President and CEO

 

40

%

Senior Vice President

 

30

%

Vice President

 

25

%

Senior Director

 

20

%

Director

 

20

%

Associate Director

 

15

%

Grades 8 and above

 

10

%

Grades 5-7

 

5

%

Grades 1-4

 

3

%

 

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Participants who were eligible for a higher target award multiplier immediately
prior to the amendment and restatement of this Plan will be grandfathered at the
higher level for a period of two years.  Weighting of corporate and individual
goals will not be grandfathered.

 

7.             Determination of Bonus Amounts.

 

(a)           Officers.  As soon as practicable after the end of each Plan Year,
the Committee shall determine the Bonus amount for each Officer by determining
(i) the performance multiplier for the corporate component of the Officers’
Bonus awards based on the Committee’s assessment of the Company’s performance
against corporate objectives for the Plan Year (the “Corporate Performance
Multiplier”), and (ii) the performance multiplier for the individual component
of each Officer’s Bonus award based on the Committee’s assessment (which may be
based on the recommendation of the President and CEO) of the Officer’s
performance against his or her individual objectives for the Plan Year.  The
same Corporate Performance Multiplier shall be used for all Officers and other
Participants under the Plan for any particular Plan Year.  If the Committee
determines that corporate or individual performance for the Plan Year exceeded
objectives or was excellent in view of prevailing conditions, the Committee may
approve corporate or individual performance multipliers, as the case may be, up
to 150% (to be applied to the target dollar amounts computed pursuant to
Sections 5 and 6 above).

 

(b)           Other Participants.  As soon as practicable after the end of each
Plan Year, the President and CEO shall determine the Bonus amount for each other
Participant (other than the Officers) by (i) applying the Corporate Performance
Multiplier determined pursuant to Section 7(a) above for the corporate component
of each Participant’s Bonus award, and (ii) determining the performance
multiplier for the individual component of each Participant’s Bonus award based
the President and CEO’s assessment (which may be based on the recommendations of
the Participant’s responsible Vice President or other immediate supervisor
and/or the Company’s Vice President, Human Resources) of the Participant’s
performance against his or her individual objectives for the Plan Year.  If the
President and CEO determines that a Participant’s individual performance for the
Plan Year exceeded objectives or was excellent in view of prevailing conditions,
the President and CEO may approve an individual performance multiplier up to
150% (to be applied to the target dollar amounts computed pursuant to Sections 5
and 6).

 

(c)           Calculation of Bonus Amount.  The example below illustrates a
sample Bonus calculation under the Plan.  First, a total target award is
calculated by multiplying a Participant’s Base Salary by the target award
multiplier for the Participant’s position. This total target award amount is
then divided between corporate and individual components based on the relative
weighting of performance factors for the Participant’s position.  This
calculation establishes specific target awards for both the individual and
corporate components of the Participant’s bonus award.

 

At the end of the Plan Year, the actual Corporate Performance Multiplier and
individual performance multipliers will be established for each Participant
using the process described above.  The Corporate Performance Multiplier, which
is based on overall corporate performance, will be used to calculate the
corporate component of all Participants’ Bonus awards.  This is accomplished by
multiplying each Participant’s target award based on corporate performance by
the actual Corporate Performance Multiplier approved by the Committee.  The
individual award multiplier, which is based on a Participant’s performance
against his or her individual objectives, is used in the same way to calculate
the individual component of the Participant’s Bonus award.

 

Example: Cash Award Calculation

 

Position:

 

Director

 

Base salary:

 

$

100,000

 

Target award multiplier:

 

20

%

Total target award:

 

$

20,000

 

 

 

 

 

Target award components (based on performance factor mix):

 

 

 

Target award based on corporate performance (40%):

 

$

8,000

 

Target award based on individual performance (60%):

 

$

12,000

 

 

 

 

 

Actual cash award calculation:

 

 

 

Assumed payment multipliers based on performance assessment:

 

 

 

Corporate Performance Multiplier:

 

75

%

Individual performance multiplier:

 

125

%

Cash award:

 

 

 

Corporate component:

 

$

6,000

 

Individual component:

 

$

15,000

 

 

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(d)           Adjustments to Bonuses.  Notwithstanding any other provision of
this Plan, the Committee (with respect to any Officer’s Bonus) or the President
and CEO (with respect to any other Participant’s Bonus) shall have the
authority, in their sole discretion and in such circumstances as they may deem
appropriate, to approve any adjustments to a Participant’s Bonus with respect to
any particular Plan Year.

 

8.             Payment of Bonuses.  Payment of a Bonus to a Participant shall be
made as soon as practicable after determination of the amount of the Bonus
pursuant to 7 above, and will occur within 75 days after the end of the Plan
Year.  Any such payment shall be in cash or cash equivalent, subject to any
applicable withholding requirements.  Participants who have been in an eligible
position for less than a year, but for at least three months, will be eligible
for a pro-rated Bonus based on the number of days in an eligible position. 
Notwithstanding the foregoing, if the payment of any Bonus at the time specified
in this Section 8 would be subject to Section 409A(a)(1) of the Code, the time
of such payment shall be automatically accelerated or delayed to the minimum
extent necessary so that Section 409A(a)(1) of the Code will not apply.

 

9.             Termination of Employment; Changes in Status.

 

(a)           The payment of a Bonus with respect to a specific Plan Year
requires that the employee be on the Company’s payroll as of the last day of
such Plan Year.  An employee whose employment with the Company is terminated,
either voluntarily or involuntarily, prior to the last day of the Plan Year will
not be eligible to receive a Bonus with respect to such Plan Year.  An employee
who terminates after the last day of the Plan Year but prior to the normal
delivery of Bonuses for such Plan Year shall be eligible to receive his or her
Bonus at the same time Bonuses are paid to all other Participants generally.

 

(c)           If a Participant transfers from one eligible position to another
prior to the end of a Plan Year, the Participant’s Bonus will be based on
(i) the target award multiplier applicable to such Participant’s position on the
last day of the Plan Year, and (ii) the Participant’s performance as it relates
to the Participant’s position on the last day of the Plan Year.

 

10.          Miscellaneous.

 

(a)           No Right to Bonus or Continued Employment.  Neither the
establishment of the Plan nor the provision for or payment of any amounts
hereunder nor any action of the Company, the Board or the Committee in respect
of the Plan, shall be held or construed to confer upon any person any legal
right to receive, or any interest in, a Bonus or any other benefit under the
Plan, or any legal right to be continued in the employ of the Company.  The
Company expressly reserves any and all rights to discharge a Participant in its
sole discretion, without liability of any person, entity or governing body under
the Plan or otherwise.

 

(c)           Absence of Liability.  No member of the Board or the Committee or
any officer of the Company shall be liable for any act or inaction hereunder,
whether of commission or omission.  No member of the Board or the Committee or
any officer of the Company shall have any liability for actions taken or omitted
under the Plan by such member or officer or any other person.

 

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(d)           No Funding of Plan.  The Company shall not be required to fund or
otherwise segregate any cash or any other assets which may at any time be paid
to Participants under the Plan.  The Plan shall constitute an “unfunded” plan of
the Company.

 

(e)           Non-Transferability of Benefits and Interests.  Except as
expressly provided by the Committee, no benefit payable under the Plan shall be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance or charge, and any such attempted action shall be void and
no such benefit shall be in any manner liable for or subject to debts,
contracts, liabilities, engagements or torts of any Participant or former
Participant.  This Section 12(e) shall not apply to an assignment of a
contingency or payment due after the death of a Participant to the deceased
Participant’s legal representative or beneficiary.

 

(f)            Amendments, Suspension or Termination of the Plan.  The Board or
the Committee may from time to time amend, suspend or terminate in whole or in
part, and if suspended or terminated, may reinstate, any or all of the
provisions of the Plan.  Such discretion may be exercised any time before,
during, and after a Plan year is completed.  No participant shall have any
vested right to receive a Bonus hereunder until actual delivery of such Bonus.

 

(g)           Tax Requirements.  All payments made pursuant to the Plan shall be
subject to all applicable taxes or contributions required by federal, state or
local law to be withheld, in accordance with procedures to be established by the
Company’s Vice President, Human Resources or other appropriate personnel.

 

(h)           Non-Exclusivity.  Nothing contained in the Plan shall limit the
authority of the Company, the Board or the Committee to grant awards or
authorize any other compensation under any other plan or authority, including,
without limitation, awards or other compensation based on the same corporate
and/or individual objectives used under the Plan.

 

(i)            Governing Law.  All questions pertaining to the construction,
regulation, validity and effect of the provisions of the Plan shall be
determined in accordance with the laws of the State of Colorado.

 

11.          Certification.  The undersigned Secretary of the Company certifies
that the foregoing constitutes a complete and correct copy of the Plan as
amended and restated on December 12, 2005, by the Compensation Committee of the
Board of Directors of Allos Therapeutics, Inc.

 

 

 

By:

       /s/ Marc H. Graboyes

 

 

 

       Marc H. Graboyes

 

 

       Vice President, General Counsel
and Secretary

 

 

 

 

Date:

    December 14, 2005

 

 

 

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