Definitive Agreement for Sphere 3D to Acquire Overland

As previously announced, on May 15, 2014 Overland Storage, Inc. entered into an Agreement and Plan of Merger with Sphere 3D Corporation, an Ontario corporation, and S3D Acquisition company Inc., a California corporation and wholly-owned subsidiary of Sphere.

In connection with the Merger Agreement, Sphere agreed to loan the company up to $5 million pursuant to a promissory note issued to Sphere by the company dated May 15, 2014.

Effective as of September 8, 2014, Sphere and the company agreed to amend and restate the Note and entered into an Amended and Restated Promissory Note pursuant to which Sphere agreed to loan the company up to $10 million.

The Amended Note is subordinated to certain existing indebtedness of the company and is secured by inventory of the company and shares of common stock of Sphere owned by the company.

To date, Sphere has advanced a total of $7 million to the company under the Amended Note.

Immediately prior to the closing of merger, the number of shares of common stock of Sphere owned by the company equal in value to the total borrowings under the Amended Note will be transferred to Sphere as payment against the Amended Note.

To the extent the Amended Note is not repaid in full by such transfer of shares, any remaining portion of the company’s obligations to Sphere under the Amended Note will remain outstanding following the completion of the merger without adjustment to the merger consideration.

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