Adaptec 2009 Annual Report Download - page 22

Download and view the complete annual report

Please find page 22 of the 2009 Adaptec annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 100

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100

Although we believe these provisions of our charter documents, Delaware law and our stockholder rights
plan will provide for an opportunity to receive a higher bid by requiring potential acquirers to negotiate with our
Board of Directors, these provisions apply even if the offer may be considered beneficial by some stockholders.
ITEM 1B. UNRESOLVED STAFF COMMENTS.
None.
ITEM 2. PROPERTIES.
We lease properties in 22 locations worldwide totaling approximately 546,000 square feet. Approximately
26% of the space we leased was excess at December 27, 2009. Approximately 84% 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 approximately 108,000 square feet in Santa Clara, California, to house our U.S. design,
engineering, sales and marketing operations.
Our Canadian operations are primarily located in Burnaby, British Columbia where we lease approximately
149,000 square feet of office space in two separate buildings. This location supports a significant portion of our
product development, manufacturing, marketing, sales and testing activities.
In addition to the two major sites in Santa Clara and Burnaby, during 2009 we also operated nine additional
research and development centers: two in Canada, four in the U.S., one in Bangalore, India, one in Herzliya,
Israel and one in Shanghai, China.
We have 11 sales/operations offices located in Europe, Asia, the Caribbean 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 (the “Federal Court”) 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.
The Beiser/Barone plaintiffs generally allege that various current and former Company directors and/or
officers breached their duty of loyalty and/or duty of care to the Company and its stockholders in connection with
improperly dating certain employee stock option grants and that these purported breaches of fiduciary duties
caused harm to the Company. The plaintiffs seek to recover damages on behalf of the Company. They also allege
violations of federal securities laws. The Company is a nominal defendant, but any recovery in the litigation
would be paid to the Company, rather than to its stockholders. The defendants have entered into joint defense
arrangements.
The defendants moved to dismiss the Beiser/Barone action on various legal grounds including that the
plaintiffs failed to state a claim and failed to plead with particularity facts establishing that a litigation demand on
the board of directors of the Company would have been futile at the time they commenced the derivative
22