Exhibit 10.3
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 ($250 if held telephonically and no fee if held
the same day as a Board meeting).
In addition to the cash component of
compensation, each non-employee director receives stock
options. Effective November 13, 2007, under our 2003
Equity Incentive Plan, which we refer to as the 2003 Incentive
Plan, each non-employee director receives a six-year nonqualified
stock option to purchase 18,000 shares on the same date as the
company’s annual meeting of shareholders. Prior to
November 13, 2007, the non-employee director options granted
under the 2003 Incentive Plan had ten-year terms. These options are
exercisable at fair market value on the date of grant and vest in
equal monthly installments over a 12-month period, as measured from
the grant date. When a new non-employee director joins the
board, such director will be awarded a new option for a number of
shares determined by multiplying 1,500 by the number of months
remaining until the next scheduled annual meeting date, giving
credit for any partial month. Such option will vest at the
rate of 1,500 shares per month and will be fully vested at the next
annual meeting date, at which time the director will receive the
normal annual grant.
On November 13, 2007, the date
of our last annual meeting of shareholders, Robert Degan, Nora
Denzel, Eric Kelly, Bill Miller, Scott McClendon and Michael Norkus
each received an option for 18,000 shares.
Compensation of Executive
Officers
Our executive officers serve at the
discretion of the Board of Directors. From time to time, the
Compensation Committee of the Board of Directors reviews and
determines the salaries that are paid to our executive officers.
The following table sets forth the annual salary rates for our
current executive officers as of the date of this
report:
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W. Michael Gawarecki
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$
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270,000
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Kurt L. Kalbfleisch
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$
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225,000
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Vernon A. LoForti
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$
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400,000
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Ravi Pendekanti
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$
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250,000
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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:
W. Michael
Gawarecki. As our
Vice President of Operations and New Product Delivery,
Mr. Gawarecki is an at-will employee and may be terminated by
us for any reason, with or without notice. On
February 14, 2008, Mr. Gawarecki was appointed to the
additional position of Vice President of New Product Delivery. In
connection with this expanded role, his annual salary was increased
from $246,500 to 270,000. On August 13, 2007, he received an
option to purchase up to 100,000 shares of our common stock at the
purchase price of $1.62 per share (the closing price of our common
stock on the date of grant) pursuant to the 2003 Incentive Plan.
The option vested over one year in equal monthly installments and
has a three-year life, subject to continuous service.
Kurt L. Kalbfleisch . As our Vice President of Finance and Chief
Financial Officer, Mr. Kalbfleisch is an at-will employee and
may be terminated by us for any reason, with or without
notice. Mr. Kalbfleisch assumed the permanent role of
Chief Financial Officer on February 14, 2008. He had been
serving as our Interim Chief Financial Officer since August 7,
2007. In connection with his appointment as Chief Financial
Officer, his annual salary was increased from $200,000 to 225,000
and he received a stock option as described below.
Mr. Kalbfleisch earned cash bonuses of $10,000 each in October
2007, January 2008, April 2008 and July 2008. On
August 13, 2007, he received an option to purchase up to
75,000 shares of the company’s common stock at the purchase
price of $1.62 per share (th
