Exhibit 10.1


SEPARATION AGREEMENT


This Separation Agreement (this “Agreement”) is dated as of
March 1, 2006 (the “Effective Date”), and is entered into by and between
Allos Therapeutics, Inc., a Delaware corporation (the “Company”), and
Michael E. Hart (“Executive” and, together with the Company, the “Parties”).


RECITALS


WHEREAS, Executive has been employed by the Company as President, Chief
Executive Officer and Chief Financial Officer of the Company pursuant to an
Employment Agreement, dated as of December 17, 2001, by and between the Company
and Executive (the “Employment Agreement”); and


WHEREAS, the parties have mutually determined that Executive shall
resign from his position as the President and Chief Executive Officer of the
Company on the first day of employment of a new Chief Executive Officer of the
Company (the “Separation Date”), and, in connection with such
separation, the Parties have agreed to settle any and all related agreements
between the Parties and their affiliates in the manner set forth herein.


NOW THEREFORE, in consideration of the promises and mutual covenants
contained herein, and for other good and valuable consideration, the receipt
and sufficiency of which are expressly acknowledged, the Parties agree and
promise as follows:


Section 1.               Resignation; Consulting.


(a)           Effective
on the Separation Date, Executive shall resign from his position as the
President, Chief Executive Officer and Chief Financial Officer of the Company,
provided that Executive shall resign as Chief Financial Officer as of any
earlier date at the request of a majority of the non-executive members of the
Board.


(b)           Notwithstanding
anything herein to the contrary, in the event that a majority of the
non-executive members of the Board determines prior to the Separation Date and
in good faith that Executive has not performed his services satisfactorily,
Executive shall, upon delivery to Executive of notice of such determination,
resign from all of his officer and other employee positions with the Company
and each of its affiliates, effective as of the date such notice is delivered,
or such later date as is designated in such notice (such date, the “Early
Separation Date”).


(c)           Following
the Separation Date or the Early Separation Date, as applicable, Executive
shall continue to serve on the board of directors of the Company (the “Board”);
provided that Executive shall resign as a director of the Company and
each of its affiliates immediately following a request from a majority of the
non-executive members of the Board.


(d)           Provided
that Executive remains employed through the Separation Date, commencing as of
the date that Executive ceases to serve as a member of the Board, and provided
further that such date of cessation is earlier than December 31, 2007, the
Company shall retain Executive as a consultant commencing on such date and
ending on December 31, 


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2007.  Executive acknowledges that the payments
being made to him and the benefits being provided to him under this Agreement
are partially in consideration of his agreement to provide such consulting
services.  All such consulting services
shall be rendered by Executive personally and the specific type and amount of
such consulting services shall be mutually approved in advance by Executive and
the Board and shall be made with consideration of Executive’s other personal
and professional commitments following the Separation Date.  The time commitment required for consulting
services under this Agreement will generally not exceed 20 hours per month,
although the time commitment required during any specific monthly period,
however, may vary from the time commitment required in other periods.


Section 2.               Termination
Benefits Upon Resignation.  The provisions of
this Section 2 shall apply only if Executive complies with the restrictive
covenants set forth in Section 6 hereof (the “Restricted Covenants”).


(a)           Severance Payments. 
The Company shall continue to pay Executive his base salary (as in
effect on the date of termination) for a period of eighteen (18) months
following the Separation Date or the Early Separation Date.  Such payments shall be payable in accordance
with the Company’s regular payroll practices and such payments are subject to
such deductions or withholdings as the Company is required to make pursuant to
law, or by further agreement with Executive.


(b)           Bonus.


(i)            Executive
hereby acknowledges receipt of his 2005 discretionary bonus as determined by
the compensation committee of the Board.


(ii)           Provided
that Executive remains employed through the Separation Date, Executive shall be
eligible to receive a pro rata portion of his discretionary bonus for the 2006
fiscal year, at the sole and complete discretion of the compensation committee
of the Board, based on the number of days elapsed from January 1, 2006 through
the Separation Date.  Such bonus shall be
paid at the same time as annual bonuses are paid to other senior executives of
the Company.


(c)           Accrued Obligations.  As soon as practicable following the Separation
Date or the Early Separation Date, but in no event later than the time period
required under applicable law, the Company shall pay Executive all earned but
unpaid base salary through the Separation Date or the Early Separation Date and
reimburse Executive for any reasonable unreimbursed expenses incurred in
accordance with Company policy. 
Additionally, Executive shall be entitled to a payment for all accrued
but unused vacation and sick pay that Executive has accrued through the
Separation Date or the Early Separation Date.


(d)           Supplemental Insurance.  The Executive shall receive, against
presentation of proper receipts, reimbursement on a grossed-up basis, for the
after-tax payment of the premiums that Executive is required to make in order
to maintain his term life insurance coverage and supplemental disability
coverage as in effect immediately prior to the Separation Date or the Early
Separation Date, for a period of twenty-four (24) months following the
Separation Date or the Early Separation Date.


 


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(e)           Continued Health Coverage. 
The Company shall provide Executive the appropriate notice under the
Consolidated Omnibus Budget Reconciliation Act of 1986 (“COBRA”).  Provided that Executive elects group health
insurance COBRA continuation coverage for Executive and his eligible
dependents, until the earlier to occur of (i) the date on which Executive is
eligible for comparable group health insurance coverage provided by a new
employer, or (ii) the date which is eighteen (18) months following the
Separation Date or the Early Separation Date, the Company shall pay for any
monthly COBRA costs payable by Executive.


(f)            Options.


(i)            Vesting.  Provided that Executive remains employed
through the Separation Date, notwithstanding the terms of the Executive’s
option agreements or the terms of the relevant Company incentive plan,
Executive shall continue to vest in his options granted prior to the Effective
Date for a period of one (1) year following the Separation Date.


(ii)           Exercise
Period.


Provided that Executive
remains employed through the Separation Date, all vested options held by
Executive on the Separation Date and those options that become vested by
operation of Section 2((f)(i) hereof shall remain exercisable until the later
of (i) ninety (90) days following Executive’s resignation from the Board or
(ii) ninety (90) days following the last day of Executive’s consulting service.


(iii)          New
Option Grant.  On the Effective Date,
the Company shall grant Executive an option to purchase 50,000 shares of the
common stock, par value $0.001 per share, of the Company (the “Common Stock”)
at an exercise price equal to the fair market value of the Common Stock on the
date of grant.


(A)          Provided
that Executive remains employed through the Separation Date, one hundred
percent (100%) of the options granted pursuant to subsection 2(f)(iii) herein
shall vest on the Separation Date, or earlier at the discretion of the Board,
and shall remain exercisable until the later of (i) ninety (90) days following
Executive’s resignation from the Board or (ii) ninety days following the last
day of Executive’s consulting service. 
If Executive’s employment as President and Chief Executive Officer is
terminated for any reason prior to the Separation Date, the option granted
pursuant to subsection 2(f)(iii) herein shall be immediately forfeited upon
such termination.


(B)           The option granted to Executive
pursuant to subsection 2(f)(iii) herein shall otherwise be subject to the terms
and conditions of the Company’s 2002 Broad Based Equity Compensation Plan (the “2002
Plan”).


 


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Section 3.               Other
Termination of Employment.  Except as
provided in Section 4 hereof and provided that Executive complies with the
Restrictive Covenants, in the event that Executive’s employment as President
and Chief Executive Officer is terminated for any reason other than by
resignation on the Separation Date or the Early Separation Date, Sections 1(d)
and 2 hereof shall not apply and Executive (or his estate in the event of his
death) shall be entitled only to the following:


(i)            continuation
of Executive’s base salary, then in effect, for a period of twelve (12) months
following the date of such termination;


(ii)           payment
of any accrued but unused vacation and sick leave;


(iii)          except
in the case of Executive’s death, reimbursement, on a grossed-up basis, for the
after-tax payment of the premiums of Executive’s supplemental disability plan
and supplemental life insurance plan for a period of twenty-four (24) months;


(iv)          payment
of premiums of Executive’s group health insurance COBRA continuation coverage,
including coverage for Executive’s eligible dependents, for a maximum period of
twelve (12) months following such termination; provided, however,
that the Company shall pay premiums for Executive’s eligible dependents only
for coverage for which those eligible dependents were enrolled immediately
prior to such termination and the Company’s obligation to pay such premiums
shall cease immediately upon Executive’s eligibility for comparable group
health insurance provided by a new employer; and


(v)           Executive’s
options granted prior to the Effective Date shall remain exercisable following
Executive’s termination in accordance with the applicable Company incentive
plan pursuant to which such options were granted.


Following any such
termination of Executive’s employment, except as set forth in this Section 3,
Executive shall have no further rights to any compensation or any other benefits
under this Agreement.


Section 4.               Change in Control.  Notwithstanding anything herein to the
contrary and provided Executive complies with the Restrictive Covenants, in the
event that Executive suffers a “Change in Control Termination” (as defined in the
Employment Agreement) prior to the Separation Date, then in lieu of any other
post-termination payments or benefits described herein, including without
limitation those described Sections 2 and 3 hereof, Executive shall instead be
entitled to the payments and benefits described in Section 11(e), “Change in
Control Severance Benefits,” of the Employment Agreement, and Section 1(d)
hereof shall not apply.  To the extent
necessary to comply with Section 409A of the Internal Revenue Code, the parties
hereto agree to delay the payment of the “Change in Control Severance Benefits”
provided in Section 11(e) of the Employment Agreement for six months.  Once such six month period has expired, the
Company shall promptly make all such payments which were delayed during such
period.


Section 5.               Termination Date.  The date upon which Executive’s employment as
President and Chief Executive Officer is terminated, whether is described in
Sections 2, 3 or 4 hereof, is hereinafter referred to as the “Termination
Date”.


 


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Section 6.               Restrictive Covenants.  Executive acknowledges that the restrictive
covenants set forth in the Proprietary Information, Inventions,
Non-Competition, and Non-Solicitation Agreement, attached to the Employment
Agreement as Exhibit A, and Sections 12 and 13 of the Employment Agreement
shall remain in full force and effect following the Termination Date and
Executive further agrees to comply with the terms of such restrictive
covenants.


Section 7.               Release.  Notwithstanding anything herein to the
contrary, Executive shall not be entitled to any benefits pursuant to this
Agreement prior to the time in which he executes a full general release of
claims against the Company and its affiliates substantially in the form
attached to the Employment Agreement as Exhibit B.


Section 8.               Non-Disparagement.  Executive agrees that, except as required by
applicable law, or compelled by process of law, at any time following the date
hereof, neither Executive, nor anyone acting on his behalf, shall hereafter
make any derogatory, disparaging or critical statement about the Company, the
Company’s subsidiaries or affiliates, or any of the Company’s current officers,
directors, employees, or shareholders or any persons who were officers,
directors, employees, or shareholders of the Company.  The Company agrees that, except as required
by applicable law, or compelled by process of law, neither it, nor anyone
acting on its behalf, shall hereafter make any derogatory, disparaging or critical
statement about the Executive.


Section 9.               Cooperation by Executive.


(a)           Following
the Termination Date, Executive will reasonably cooperate in all reasonable
respects with the Company and its affiliates in connection with any and all
existing or future litigation, actions or proceedings (whether civil, criminal,
administrative, regulatory, or otherwise) brought by or against the Company or
any of its affiliates, to the extent the Company reasonably deems Executive’s
cooperation necessary.  Executive shall
be reimbursed for all reasonable out-of-pocket expenses incurred by his as a
result of such cooperation.


(b)           For
the period commencing on the Effective Date and ending on the Termination Date,
Executive shall devote his full business time, attention, skill and best
efforts to the performance of his duties as the Company’s President, Chief
Executive Officer and (if applicable) Chief Financial Officer.


Section 10.             Indemnification.  The Company acknowledges that (a) its by-laws
(or those of one or more of its affiliates) contain provisions indemnifying
directors and officers to the fullest extent permitted by applicable law and
(b) Executive is covered by such provisions (as such provisions are in effect
on the Termination Date) to the extent permitted by applicable law even after
the Termination Date with respect to such matters occurring during the course
of Executive’s employment before the Termination Date, subject to the terms of
such by-law provisions (as such provisions are in effect on the Termination
Date).


Section 11.             Confidentiality of Agreement.  Executive hereby agrees to keep the terms of
this Agreement confidential; provided, that the obligations of Executive under
this Section 11 shall not apply to disclosures required by applicable law, regulation
or order of a court or governmental agency, to either Executive’s counsel, or
to Executive’s immediate family.


 


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Section 12.             Opportunity for Advice.  By signing this Agreement, Executive
acknowledges that with the advice of the Company, he has had a reasonable
opportunity to consider advice from his legal counsel.  Fully understanding these terms, Executive is
entering into this Agreement knowingly and voluntarily.  The Company hereby agrees to pay the
reasonable fees and expenses of the Executive’s legal counsel incurred in
connection with the negotiation and review of this Agreement, up to a maximum
of $10,000.


Section 13.             Entire Agreement.  This Agreement represents the entire
agreement of the parties with respect to Executive’s engagement and termination
thereof, and supersedes all prior negotiations, discussions, correspondence,
communications, understandings and agreements between the parties relating to
the subject matter of this Agreement.


Section 14.             Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE
APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE.


Section 15.             Severability.  In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, in whole or in part, the remaining provisions of this Agreement shall
be unaffected thereby and shall remain in full force and effect to the fullest
extent permitted by law.


Section 16.             Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall be considered one and the same agreement.


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IN WITNESS WHEREOF, the
parties have executed this Agreement as of the date and year first above
written.


	
   

  	
  /s/ Michael E. Hart

  
	
   

  	
  Michael E. Hart

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ALLOS
  THERAPEUTICS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Stephen J. Hoffman

  
	
   

  	
  Name:

  	
  Stephen J. Hoffman

  
	
   

  	
  Title:

  	
  Chairman

  



 


 


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