Document:

EXHIBIT 10.2

 

ALLOS THERAPEUTICS, INC.

SEVERANCE BENEFIT SCHEDULE

 

For employees of Allos Therapeutics, Inc.
(the “Company”) who are terminated pursuant to involuntary reductions in the
work force effecting more than two employees during 2006.

 

This Severance Benefit Schedule (the “Schedule”) is made pursuant
to the Company’s Severance Benefit Plan. 
The Company reserves the right to establish severance guidelines on an
action by action basis.  This Schedule may
be altered, amended or cancelled at any time in the sole discretion of the
Company.

 

A basic severance benefit consisting of four weeks current base pay
will be provided to all laid off employees.

 

As a condition to receiving additional
severance benefits, an Eligible Employee must sign a general release agreement
releasing the Company from all claims known or unknown that employee may have
against the Company. 
No additional benefits will be paid until the Company has received a
signed general release.  The contents of
the general release will vary, depending on the state in which the affected
employee(s) resides, the age of the employee(s), and whether two or more
employees are affected by the same action. Consult with legal for the specific
release to be used.

 

Nothing contained in the Company’s Severance Benefit Plan or this Schedule alters
or amends employee’s status as an at will employee.  As an at will employee either the employee or
the Company may terminate the employment relationship with or without cause,
with or without notice.

 

The following schedules apply to severance benefits for Eligible
Employees of the Company who are terminated pursuant to the terms of the
Severance Benefit Plan as part of involuntary reductions in the work force of
over two employees during 2006.

 

All ELIGIBLE EMPLOYEES:

 

SEVERANCE BENEFIT:

 

Without Eligible Employee’s signed release: Four
weeks current base pay (excludes overtime and bonuses).

 

Basic Severance Pay:  Four weeks current
base pay (excludes overtime and bonuses).

 

With Eligible Employee’s signed release:

 

Additional Severance Pay:  An additional one week base pay (excludes
overtime and bonuses) per $10,000 of annualized current base pay, with a
minimum total Severance Benefit under this Schedule of eight weeks base
pay and a maximum total Severance Benefit under this Schedule of 26 weeks
base pay.

 

 

Insurance Continuation Benefit:  The
Company shall pay the premiums of Eligible Employee’s group health insurance
COBRA continuation coverage, including coverage for eligible dependents, for
the period of the Severance Benefit; provided, however,
that (a) the Company shall pay premiums for Eligible Employee’s eligible
dependents only for coverage for which those eligible dependents who were
enrolled immediately prior to the Change in Control termination and (b) the
Company’s obligation to pay such premiums shall cease immediately upon Eligible
Employee’s eligibility for comparable group health insurance provided by a new
employer of Eligible Employee.  For
purposes of COBRA, the COBRA period will begin upon termination resulting from
the group termination.  Any Eligible
Employee shall immediately notify the Plan Administrator upon obtaining
employment pursuant to which he or she is employed on the average of 30 hours
or more each week.

 

Outplacement Assistance:  The Company shall provide outplacement
assistance through an outside organization as a resource to laid off employees
in their career transition.  The amount
of assistance will vary by job level at the sole discretion of the Company.Exhibit 10.1

 

OVERLAND STORAGE, INC.

SUMMARY SHEET

OF

DIRECTOR AND EXECUTIVE OFFICER COMPENSATION

 

Non-Employee Director Compensation 

 

Our compensation plan for non-employee
directors consists of both a cash component and an equity component. We pay
each non-employee director $5,000 per quarter, plus $2,500 for each Board
meeting attended ($1,250 if held telephonically), plus reimbursement for
expenses. The Chairman of the Board receives an additional $2,500 per quarter
in addition to the non-employee director fee of $5,000 per quarter.  Members of the Audit Committee and the
Compensation Committee receive a retainer of $500 per quarter in lieu of a fee
for committee meetings attended during a quarter and members of the Nominating
and Governance Committee receive $500 for each committee meeting attended ($250
if held telephonically and no fee if held the same day as a Board meeting).  Members of the Special Committee on
Shareholder Value will receive $500 for each committee meeting attended
(whether telephonically or in person) since formation of the committee.  Such fee will not be paid for committee
meeting in joint session with the full board.

 

In addition to
the cash component of compensation, each non-employee director receives stock
options.  Under our 2003 Equity Incentive
Plan, which we refer to as the 2003 Incentive Plan, each non-employee director
receives a ten-year nonqualified stock option to purchase 18,000 shares on the
same date as the company’s annual meeting of shareholders.  These options are exercisable at fair market
value on the date of grant and vest in equal monthly installments over a
12-month period, as measured from the grant date.  When a new non-employee director joins the
board, such director will be awarded a new option for a number of shares
determined by multiplying 1,500 by the number of months remaining until the
next scheduled annual meeting date, giving credit for any partial month.  Such option will vest at the rate of 1,500
shares per month and will be fully vested at the next annual meeting date, at
which time the director will receive the normal annual grant. On November 15,
2005, the date of our last annual meeting of shareholders, Scott McClendon,
Robert Degan and Michael Norkus each received an option for 18,000 shares.  In connection with his election to the Board,
Mark Barrenechea received an option for 16,500 shares on December 21, 2005.

 

Compensation of Executive Officers

 

Our executive officers serve
at the discretion of the Board of Directors. From time to time, the
Compensation Committee of the Board of Directors reviews and determines the
salaries that are paid to our executive officers. The following table sets
forth the annual salary rates for the our current executive officers as of the
date of this report on Form 10-Q:

 

	
  Christopher Calisi

  	
   

  	
  $

  	
  395,000 

  	
  (1)

  
	
  Diane N. Gallo

  	
   

  	
  $

  	
  199,500

  	
   

  
	
  W. Michael Gawerecki

  	
   

  	
  $

  	
  246,500

  	
   

  
	
  Christie Huff

  	
   

  	
  $

  	
  195,000

  	
   

  
	
  George Karabatsos

  	
   

  	
  $

  	
  350,000 

  	
  (2)

  
	
  Michael S. Kerman

  	
   

  	
  $

  	
  225,000

  	
   

  
	
  Vernon A. LoForti

  	
   

  	
  $

  	
  297,750

  	
   

  
	
  Robert J. Scroop

  	
   

  	
  $

  	
  220,500

  	
   

  

 

(1)  Effective November 15, 2005, at the request
of Mr. Calisi, we reduced his annual salary from $500,000 to $395,000 as
described more fully under “Employment Arrangements with Current Executive
Officers” below.

 

(2) Of this amount, $175,000
is tied to performance as described more fully under “Employment Arrangements
with Current Executive Officers” below.

 

1

 

Employment Arrangements with Current Executive Officers

 

The following discussion summarizes
the employment arrangements between us and our current executive officers as of
the date of this report on Form 10-Q:

 

Christopher
Calisi.  We entered into an employment agreement with
Mr. Calisi on March 12, 2001, pursuant to which Mr. Calisi is employed as our
President and Chief Executive Officer. The employment agreement has a one-year
term, automatically renews for successive one-year terms, and provides that our
Board may unilaterally modify Mr. Calisi’s compensation at any time.  If we terminate Mr. Calisi’s employment
without cause, then we are obligated to pay him a severance payment equal to
his base salary, payable on a pro-rated basis according to our normal payroll
cycle for the 12 months following his termination. In addition, he is entitled
to receive accelerated vesting for any stock options that would otherwise have
vested during the 12-month period following his termination. He is also
entitled to receive the cash severance payment if he resigns for good reason
because of any of the following events: (i) reduction in compensation of more
than 10%; (ii) change in position or duties so that his duties are no longer
consistent with his previous position; or (iii) change in principal place of
work to more than 50 miles from our current facility without his approval.

 

On November 22, 2005, we amended the
terms of Mr. Calisi’s employment agreement and retention agreement
pursuant to a voluntary offer made by Mr. Calisi at a meeting of our board of
directors on November 15, 2005.  Pursuant
to the amendments, Mr. Calisi’s gross annual base salary was reduced from
$500,000 to $395,000 effective as of November 15, 2005, except that solely
for purposes of calculating severance payments under the employment agreement
and retention agreement, Mr. Calisi’s salary will be deemed to be the
greater of $500,000 or his then current salary as of the date of termination or
a change of control, as applicable.  The reduction in salary will reduce
the annual bonus for which Mr. Calisi is eligible under the employment
agreement and the retention agreement, and will not constitute “good reason” to
terminate the employment agreement or retention agreement.  The board of directors
will have sole and absolute discretion to modify Mr. Calisi’s compensation
going forward, including any increase in compensation, subject to the existing
terms of the agreements.

 

The annual salary of Mr. Calisi had been
increased to $500,000 by the Compensation Committee on April 28, 2005 effective
immediately.  On that day, Mr. Calisi also received (1) a cash bonus of
$21,500 effective immediately, (2) a grant of 50,000 restricted shares of our
common stock pursuant to the 2003 Incentive Plan, which vest in installments of
16,667, 16,667 and 16,666 shares on January 1, 2006, January 1, 2007 and
January 1, 2008, respectively, (3) an option to purchase up to 100,000 shares
of our common stock at the purchase price of $11.00 per share pursuant to
the 2003 Incentive Plan, which option is immediately vested as to 11,200
shares, with the remainder vesting at a rate of 2,775 option shares on the last
day of the month commencing May 31, 2005 through December 31, 2007, and (4) a
grant of an additional 50,000 restricted shares of our common stock pursuant to
the 2003 Incentive Plan, which will vest as to 12,500, 12,500 and 25,000
shares, respectively, if the volume weighted daily average stock price for ten
consecutive trading days reaches $20, $25 and $30, respectively, on or before
January 1, 2008, provided that Mr. Calisi is employed by us as Chief Executive
Officer on such dates(s).  Mr. Calisi continues to be eligible to receive
a performance bonus equivalent to 75% of his base salary pursuant to our MBO
and Bonus Program.  The above referenced
stock option grant to Mr. Calisi accelerates upon a Change in Control as
defined in the 2003 Incentive Plan.  The vesting of shares underling the
stock option and restricted stock grants pursuant to the 2003 Incentive Plan
described above will cease upon termination of  Service to Overland, as
defined in the 2003 Incentive Plan.

 

Diane N. Gallo.  Ms. Gallo, our Vice President, Human Resources, is an at-will employee
and may be terminated by us for any reason, with or without notice.  Ms. Gallo currently earns an annual salary of
$199,500.

 

W. Michael Gawarecki.   On September 9, 2005, we
entered into an employment agreement with Mr. W. Michael Gawarecki, our Vice
President of Operations, which was effective as of May 16, 2005.  Under the agreement, Mr. Gawarecki is
entitled to a base salary of $246,500 per year and is eligible for
discretionary quarterly bonuses under our MBO and Bonus Plan, which bonuses may
not exceed 40% of Mr. Gawarecki’s quarterly base salary.  Mr. Gawarecki was also eligible to receive a
special bonus related to outsourcing of $100,000, but the conditions for
receiving that bonus were not satisfied. 
Mr. Gawarecki’s current base salary is $246,500.  The term of the agreement will continue until
June 30, 2006 and will not renew unless agreed by the parties in writing.  If Mr.

 

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Gawarecki is terminated without cause or
resigns with good reason, he will be entitled to receive a severance payment
equal to 100% of his then annual base salary, subject to the execution by him
of a general release of claims against us. 
This severance will be paid in either a lump-sum amount or in twelve
equal monthly installments without interest, at the election of Mr.
Gawarecki.  Our obligation to pay
severance to Mr. Gawarecki under the agreement terminates upon the
occurrence of a change in control.

 

Christie Huff.  Ms.
Huff, our Vice President of Worldwide Marketing, is an at-will employee and may
be terminated by us for any reason, with or without notice.  Ms. Huff currently earns an annual salary of $195,000
per year.

 

George Karabatsos.  Mr.
Karabatsos, our Vice President of Worldwide Sales, is an at-will employee and
may be terminated by us for any reason, with or without notice.  Ms. Karabatsos currently earns an annual
salary of $350,000, with $175,000 of that amount guaranteed as base salary and
$175,000 tied to performance.    When Mr. Karabatsos joined Overland on August
8, 2005, he was granted an option to purchase up to 100,000 shares of the our  common stock at the purchase price of $7.84
per share pursuant to the 2003 Incentive Plan, which option will vest over a
three-year period with one-third vesting on August 8, 2006 and the remaining
two-thirds vesting monthly over the 24 months following that date in equal
installments. The option will accelerate upon a Change in Control as defined in
the 2003 Incentive Plan.  The option has
a ten-year life, subject to continuous service to us.  On his hire date, he was also awarded 15,000
restricted shares of our common stock pursuant to the 2003 Incentive Plan,
which shares will vest in annual installments of 5,000 shares on each of August
8, 2006, August 8, 2007 and August 8, 2008, subject to continuing service to us.  In addition, we agreed to reimburse Mr.
Karabatsos for up to $20,000 of relocation expenses incurred by Mr. Karabatsos
in his move to San Diego County, and up to $4,000 per month, for up to three
months, for temporary housing.  If Mr.
Karabatsos is terminated for cause within the first twelve months of his
employment, he must repay the amount of his moving and relocation costs and the
amount of his signing bonus (pro-rated on a monthly basis from the first date
of his employment).

 

Michael S. Kerman.  Mr.
Kerman, our Vice President and General Manager of the Appliance Business Unit,
is an at-will employee and may be terminated by us for any reason, with or
without notice.  Mr. Kerman currently
earns an annual salary of $225,000 per year. 
In addition, we agreed to reimburse Mr. Kerman for up to $100,000 of
relocation expenses incurred by Mr. Kerman  in the event that he is
terminated without cause on or before April 29, 2006 and he incurs such
expenses related to a relocation outside of San Diego within six months of his
date of termination.

 

Vernon A. LoForti.  We
entered into an employment agreement with Mr. LoForti on December 4, 2000,
pursuant to which Mr. LoForti is employed as our Vice President and Chief
Financial Officer. The employment agreement has a one-year term, automatically
renews for successive one-year terms, and provides that our Board may
unilaterally modify Mr. LoForti’s compensation at any time.  If we terminate Mr. LoForti’s employment
without cause, then we are obligated to pay him a severance payment equal to
his base salary, payable on a pro-rated basis according to our normal payroll
cycle for the 12 months following his termination. In addition, he is
entitled to receive accelerated vesting for any stock options that would
otherwise have vested during the 12-month period following his termination. He
is also entitled to receive the cash severance payment if he resigns for good
reason because of any of the following events: (i) reduction in compensation of
more than 10%; (ii) change in position or duties so that his duties are no
longer consistent with his previous position; or (iii) change in principal
place of work to more than 50 miles from our current facility without his
approval.  Mr. LoForti currently earns a
salary of $297,750 per year.

 

Robert J. Scroop.  Mr. Scroop, our Vice President Engineering, is an at-will employee and
may be terminated by us for any reason, with or without notice.  Mr. Scroop currently earns an annual salary
of $220,500 per year.

 

Stock Option Acceleration Program

 

In July 2005, our Board of Directors approved the accelerated vesting
of all unvested stock options, held by the company’s officers and employees,
with an exercise price at or above $12.00 per share, effective July 3, 2005.
The stock option acceleration program does not apply to stock options held by our
non-employee directors. The accelerated options were issued under the 2000
Stock Option Plan, the 2001 Supplemental Stock Option Plan and the 2003
Incentive Plan.  In connection with the
acceleration of vesting of options held by our executive officers, 

 

3

 

each executive officer agreed not to sell or transfer any shares
subject to accelerated vesting until the original vesting date would have
occurred based on the original vesting schedule (without giving effect to any
future termination of service). The primary purpose of the accelerated vesting
was to eliminate future stock-based employee compensation expense.

 

Retention Agreements

 

We entered into retention agreements with
Messrs. LoForti, Scroop and Gawarecki effective January 27, 2000, with
Mr. Calisi effective March 12, 2001, with Ms. Gallo effective August
30, 2002, with Mr. Kerman effective August 30, 2004, with Mr. Karabatsos
effective  August 8, 2005 and with Ms.
Huff effective September 14, 2005.   These agreements provide that the officer will
receive a severance payment if, within two years of the consummation of a
change in control of Overland, he or she is terminated without cause or resigns
with good reason. These severance payments are based on the officer’s base
salary at the time of the consummation of the change in control or the
termination date, whichever is higher, plus his or her target bonus for the
year prior to the consummation of the change in control. The agreements provide
that, upon a change in control, Mr. Calisi would be entitled to receive an
amount equal to 2.5 times his base salary plus target bonus, and
Mr. LoForti would be entitled to receive an amount equal to 2.0 times his
base salary plus target bonus. Ms. Gallo, Ms. Huff, and Messrs. Gawarecki,
Karabatsos, Kerman, and Scroop each would be entitled to an amount equal to
their respective base salary plus target bonus. If any portion of any payment
under any of the agreements would constitute an “excess parachute payment”
within the meaning of Section 280G of the Internal Revenue Code, then that
payment will be reduced to an amount that is one dollar less than the threshold
for triggering the tax imposed by Section 4999 of the Internal Revenue
Code.

 

MBO and Bonus Plan

 

Our Chief Executive Officer
and other executive officers, except Mr. Karabatsos, participate in our
executive bonus plan which is designed as a performance-based component of
their compensation package. The Compensation Committee tailors the plan for
each executive to be unique to his or her area of responsibility. For fiscal
year 2006, the plan established by the Compensation Committee has been and will
be evaluated and paid on a quarterly basis, and include two performance
measurement points for each executive officer:

•  our
actual earnings per share (EPS) in comparison to the target approved by the
Compensation Committee; and

•  achievement of individual job performance
goals and objectives.

 

No bonuses were paid under the plan for the first or second fiscal
quarter of 2006, as the EPS targets were not achieved.

 

Discretionary Bonus

 

On January 24, 2006, the Compensation
Committee of our board of directors approved a $10,000 discretionary bonus
payable immediately to certain of our executive officers in recognition of certain
OEM business awarded to Overland.  The
$10,000 discretionary bonus was paid to each of the following executive
officers in February 2006:

 

	
  Diane N. Gallo

  	
   

  	
  Vice President, Human
  Resources

  
	
  W. Michael Gawarecki

  	
   

  	
  Vice President, Operations

  
	
  Christie Huff

  	
   

  	
  Vice President, Worldwide
  Marketing

  
	
  Michael Kerman

  	
   

  	
  Vice President and General
  Manager, Appliance Business Unit

  
	
  Vernon A. LoForti

  	
   

  	
  Vice President, Chief
  Financial Officer and Secretary

  
	
  Robert J. Scroop

  	
   

  	
  Vice President,
  Engineering

  

 

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