Adaptec 2006 Annual Report Download - page 33

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Table of Contents
ITEM 1B. Unresolved Staff Comments.
On January 19, 2007, we received a comment letter from the SEC asking us to further amend our Form 10-K for the year ended December 31, 2005 (the “2005
10-K/A”) to comply with the recently issued SEC guidance in “Sample Letter Sent in Response to Inquiries Related to Filing Restated Financial Statements for
Errors in Accounting for Stock Option Grants” (the “Sample Letter”). In subsequent discussions and correspondence with the SEC, the SEC has agreed that we
may comply with the guidance in the Sample Letter in this Annual Report on Form 10-K for the year ended December 31, 2006 instead of amending our 2005
10-K/A. We have amended the disclosure herein to comply with the Sample Letter.
ITEM 2. Properties.
PMC leases properties in 24 locations worldwide. Approximately 27% of the space leased by PMC was excess at December 31, 2006. Approximately 40% of the
excess space has been subleased and we are actively pursuing opportunities to sublease or negotiate our exit from the remaining excess facilities.
We lease a total of 108,000 square feet in Santa Clara, California, to house our US design, engineering, sales and marketing operations. In 2006 we vacated
approximately 35,000 square feet in Santa Clara in connection with our workforce reduction activities.
Our Canadian operations are located in Burnaby, British Columbia where we lease 147,000 square feet of office space in two separate buildings. These locations
support a significant portion of our product development, manufacturing, marketing, sales and testing activities. In late 2006 we vacated approximately 91,000
square feet in Kanata, Ontario in connection with operational consolidation activities.
We also operate nine additional research & development centers: three in Canada, three in the US, one in Bangalore, India, one in Herzliya, Israel and one in
Shanghai, China.
We have eleven sales/operations offices located in Europe, Asia, the Middle East and North America.
ITEM 3. Legal Proceedings.
Stockholder Derivative Lawsuits
Three derivative actions have been filed against the Company, as a nominal defendant, and various current and former officers and/or directors: (1) Meissner v.
Bailey, et al., Santa Clara Superior Court Case No. 1-06-CV-071329 (filed September 18, 2006); (2) Beiser v. Bailey, et al., United States District Court for the
Northern District of California Case No. 5:06-CV-05330-RS (filed August 29, 2006); and (3) Barone v. Bailey, et al., United States District Court for the
Northern District of California Case No. 4:06-CV-06473-SBA (filed October 16, 2006). On November 21, 2006 the Beiser and Barone actions were consolidated
into one case. On January 18, 2007, the Santa Clara County Superior Court in California ordered that the Meissner action be stayed pending the outcome of the
consolidated, federal Beiser/Barone action. A consolidated complaint in the Beiser/Barone action was filed on January 29, 2007 (the “Consolidated Complaint”).
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Source: PMC SIERRA INC, 10-K, March 01, 2007 Powered by Morningstar® Document Research℠