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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 14, 2006
ADEPT TECHNOLOGY, INC.
(Exact name of registrant as specified in its charter)
California 0-27122 94-2900635
(State or other jurisdiction (Commission file number) (I.R.S. Employer
of incorporation) Identification Number)
3011 Triad Drive 94550
Livermore, CA (Zip Code)
(Address of principal executive offices)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (925) 245-3400
None
(Former Name or Former Address, if Changed Since Last Report)
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
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Item 1.01. Entry into a Material Definitive Agreement/
Item 5.02. Compensatory Arrangements of Certain Officers
Adoption of Fiscal 2007 Executive and Key Employee Bonus Plan
On November 14, 2006, the Board of Directors of Adept Technology, Inc.
("Adept" or the "Company") approved the adoption by the Company of the Executive
and Key Employee Cash Bonus Plan for fiscal year 2007 (the "Bonus Plan"). The
Bonus Plan establishes the terms and targets of performance cash bonuses for
Adept's executive officers and certain other key employees of the Company for
the 2007 fiscal year, as recommended by Adept's Compensation Committee of the
Board of Directors. Under the Bonus Plan, executive performance bonuses are
based on various targets, generally involving revenue and operating profit, and
executive sales commissions are based upon applicable sales revenue. The Bonus
Plan is not subject to the approval of Adept stockholders. The Company's Board
and the Compensation Committee reserves the right to modify the targets at any
time or to grant bonuses to executives on a discretionary basis.
The Bonus Plan is attached as Exhibit 10.1 hereto and is incorporated
herein by this reference.
Adoption of Fiscal 2007 Performance Stock Guidelines
On November 14, 2006, the Board of Directors of Adept approved the
performance stock guidelines of the Company for fiscal year 2007 (the
"Performance Stock Guidelines"). The Performance Stock Guidelines establish
certain parameters for consideration of grants of stock options or restricted
stock based upon employee performance for the 2007 fiscal year, as recommended
by Adept's Compensation Committee of the Board of Directors, so that equity
compensation grants approved by the Compensation Committee for the fiscal year
will be considered and awarded in a manner consistent with the overall goals for
the equity compensation element of Adept employee compensation. The stock
options or restricted stock would generally be granted under the Company's 2003
Stock Option Plan or 2005 Incentive Plan.
The number of shares of the Company's common stock covered by each
quarterly grant will be determined for each eligible employee by the
Compensation Committee based on factors including recommendations of management,
and the role and performance of each participant in any specifically identified
program of the Company. The shares covered by the grants would have varying
vesting terms, with options generally vesting monthly over the 48 months
following the grant date. The Company's Board and Compensation Committee reserve
the right to identify the employee considered for quarterly grants, and modify
the goals and targets for Adept's targeted projects at any time. Additional
detail to parameters for grants of executive stock options and restricted stock
is identified in the guidelines.
The Performance Stock Guidelines are attached as Exhibit 10.2 hereto
and are incorporated herein by this reference.
Approval of Executive Salary Information/Amendment to Executive Salaries
On November 14, 2006, the Compensation Committee of the Board approved
certain increases to executive salary compensation for the Company's fiscal 2007
effective for the first pay period following the date of such approval,
including increases in salary to Messrs. Matthew Murphy and John Dulchinos.
Additionally, by adoption of the Bonus Plan disclosed above, the Company
identified target cash bonus amounts for each of the executive officers. A
summary of executive compensation, as amended, is attached as Exhibit 10.3
hereto and is incorporated herein by this reference.
Further, the Compensation Committee of the Board approved certain
payments of sales commissions made pursuant to the Company's fiscal 2006 bonus
plan relating to the fourth quarter of fiscal 2006 to two executive officers and
a former executive officer, as identified on Exhibit 10.3 hereto and
incorporated herein by this reference.
Amendment of 2004 Director Stock Option Plan
On November 14, 2006, the stockholders approved an amendment to Adept's
2004 Director Stock Option Plan (the "2004 Director Plan") to increase the total
number of authorized shares under the 2004 Director Plan by an additional 72,000
shares of Adept common stock.
The 2004 Director Plan, as amended, is incorporated by reference herein
as specified in Exhibit 10.4 hereto.
Item 5.05. Amendments to the Registrant's Code of Ethics
Amendment of Adept Code of Business Conduct
On November 14, 2006, the Board of Directors of Adept approved the
amendment of the Company's Code of Business Conduct applicable to employees of
Adept, principally to reflect changes to the Company's whistleblower policy
directing individuals with accounting or auditing concerns or issues to direct
such communications to the Company's Audit Committee and revising the
certification requirements under the Code of Business Conduct.
The Code of Business Conduct, as amended, is attached as Exhibit 10.5
hereto and is incorporated herein by this reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
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Exhibit No. Description
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10.1 Fiscal 2006 Executive Bonus Plan
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10.2 Performance Stock Guidelines
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10.3 Summary of Executive Officer Compensation
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10.4 2004 Director Stock Option Plan, as amended (incorporated
by reference to Appendix A to Adept Technology, Inc.'s
Proxy Statement on Schedule 14A for the 2006 Annual
Meeting filed with the SEC on October 20, 2006)
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14.1 Code of Business Conduct, as amended
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ADEPT TECHNOLOGY, INC.
Date: November 20, 2006 By: /s/ Steven L. Moore
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Steven L. Moore
Vice President of Finance and
Chief Financial Officer
Index to Exhibits
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Exhibit No. Description
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10.1 Fiscal 2006 Executive Bonus Plan
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10.2 Performance Stock Guidelines
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10.3 Summary of Executive Officer Compensation
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10.4 2004 Director Stock Option Plan, as amended (incorporated
by reference to Appendix A to Adept Technology, Inc.'s
Proxy Statement on Schedule 14A for the 2006 Annual
Meeting filed with the SEC on October 20, 2006)
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14.1 Code of Business Conduct, as amended
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Exhibit 10.1
ADEPT TECHNOLOGY, INC.
EXECUTIVE AND KEY EMPLOYEE CASH BONUS PLAN
FISCAL 2007
1. PURPOSE.
The purpose of the Executive Bonus Plan ("Plan") is to motivate and reward the
CEO and other individuals who are appointed officers (collectively, the
"Officers") and other key employees of Adept Technology, Inc. (the "Company") in
order to improve the Company's profitability and achieve the established
corporate goals of the Company. The Plan will not place the Company in a
negative cash flow exclusive of financing activities or negative earnings per
share for the period of measurement of the Plan. Under the Plan, an Officer or
other identified employee may be awarded for each fiscal year of the Company a
discretionary bonus.
The Plan is designed to reward both the individual executive and the operating
team as a group for performance that exceeds the base plan developed by the
Chief Executive Officer of the Company and approved by the Compensation
Committee. The Company's goal is to grow its revenues while maintaining control
over operational spending and improving gross margin which will generate a
positive cash flow and operating profit before FAS 123R equity compensation
expense. This profitability will allow Adept to sustain company investments in
both product development and sales and marketing infrastructure and finance
organization for operating as a public company, while supporting a positive
improvement in market capitalization and share value.
The Plan assumes that each executive receives base pay compensation commensurate
with their responsibilities and the Bonus or Commission payable under the Plan
is not an entitlement or a guarantee of payment, rather the plan would be paid
out to the executive for corporate goals and milestones beyond Base plan
expectations and are a benefit to the shareholders of Adept Technology, Inc.
2. THE COMMITTEE.
The Plan shall be administered by the Compensation Committee of the Board of
Directors of the Company (the "Compensation Committee"). The Compensation
Committee shall have the sole discretion and authority to administer and
interpret the Plan, and the decisions of the Compensation Committee shall in
every case be final and binding on all persons having an interest in the Plan.
3. BONUS.
The performance criteria, target bonus, and other factors relating to the
bonuses under the Plan shall be determined by the Compensation Committee in its
discretion after consultation with the Company's Chief Executive Officer.
Performance criteria for any Officer of the Company may include, without
limitation, either individually or in combination, applied to the Company as a
whole or to individual units thereof, and measured either absolutely or relative
to a designated group of comparable group of companies: (a) cash flow, (b)
earnings per share (including earnings before interest, taxes and amortization),
(c) return on equity, (d) total stockholder return, (e) return on capital, (f)
return on assets or net assets, (g) revenue or revenue growth, (h) income or net
income, (i) operating income or net operating income, (j) operating profit or
net operating profit (including or excluding the impact of FAS 123R), (k)
operating margin, (l) return on operating revenue, (m) market share, (n)
customer loyalty as measured by a customer loyalty index determined by an
independent consultant expert in measuring such matters, or (o) any other
objective and measurable criteria tied to the Company's performance. The
Compensation Committee may in its discretion direct that any bonus be increased
above or reduced below the amount determined based on satisfaction of criteria
determined by the Compensation Committee, based on individual performance.
4. THE PAYMENT OF BONUSES.
The Plan consists of a performance cash bonus plan and a sales executive
commission plan. The Plan non-Sales Executive Bonus (Addendum A) is designed to
provide a maximum cash incentive up to a defined % of the executive's base
salary, determined at the commencement of the Bonus Plan period. The Sales
Executive Commission Plan Structure (Addendum B) is designed to provide a
revenue generation incentive as a % of revenue within the executive
responsibility and geography determined at the commencement of the Plan period.
Notwithstanding the foregoing, the maximum aggregate amount payable under this
Plan to any Officer for any fiscal year as a performance bonus for fiscal 2007
shall be $400,000. Except where specifically noted in the relevant addendum to
this plan the bonus or bonuses for a fiscal year (including all short
performance periods ending with or within such year) shall be paid as soon as
practicable following the end of such year (or applicable quarter, with respect
to sales commission bonuses) after completion of the Company's financial
statements for such fiscal period but no later than one business day after the
filing with the SEC of the applicable financial statements for such fiscal
period. The Plan is not part of an individual's base compensation. To be
eligible to receive compensation under the Plan, the executive or other
individual must remain in continued participation of the Plan (termination of
participation which will be at the discretion of the CEO and accordingly
at-will) and continued full-time active employment through the entire
measurement period. Additional employee participation will require 3 months of
employment in their position prior to inclusion into the Plan, or may be added
at the discretion of the Compensation Committee of Adept after consultation with
the CEO. The Plan does not constitute any guaranteed payment or a contract of
employment.
Further, unless otherwise provided in a written agreement with an Officer, the
Officer must be employed by the Company on the date that bonus payments are
distributed for a fiscal quarter (for sales commissions) or year, as applicable,
or have terminated employment prior to that time solely on account of death or
disability. Further, unless otherwise approved by the Compensation Committee,
the Plan shall be in lieu of and replace any other variable compensation, bonus
plan or salary merit increase otherwise offered by the Company to eligible
recipients under the Plan.
5. AMENDMENT AND TERMINATION.
The Compensation Committee may terminate the Plan at any time, for any and no
reason, and may also amend the Plan, including in order to reduce the amount of
any Officer's bonus payments at any time, for any or no reason.
ADEPT TECHNOLOGY, INC.
FY2007 EXECUTIVE BONUS PAYMENT PLAN
Addendum A
EPP FY 2007 Bonus Plan
Adept Technology, Inc.
Up to a defined percentage of the participants salary (15%, 25%, 40% or 60%)
will be paid for achieving financial performance. Note, the Payout is computed
as follows:
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Final Results % (chart) * Participant % of salary target * $salary = $payout
Example: 37.5% * 25% * $120,000 = $11,250
Payout Timing: end of fiscal year following audited results
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List of Participants is made up of those executives and other key employees
primarily responsible for the profitability, cash management and strategic
product and market direction...of the company. They are:
CEO, VP Operations and Engineering, CFO, VP Business Development, CTO, Dir
Engineering, Director Production, Director HR, Financial Controller, Software
Architect, Key Engineering, Service and Marketing employees.
1. Up to 50% of the EPP based upon revenue at specified levels.
2. Up to 50% of the EPP based upon operating profit of specified levels.
If performance achievement is between targets specified below, the percentage
payable shall be determined by interpolation.
With regard to Steven Moore, Adept CFO, the terms of his employment agreement
dated May 24, 2006 will remain in force. Terms outlined for Mr. Moore provide
for a 40% bonus to be earned as follows:
-- For the first six months of FY2007 a 20% bonus will be earned upon
completion of financial process streamlining and simplification
necessitated by the company's size and ultimately SEC and
Sarbanes-Oxley compliance. Specific targets will be defined and
approved by the Compensation Committee.
-- The remaining 20% bonus will be earned during the second half of the
year in alignment with the financial goals of the rest of the
management team.
An additional discretionary bonus may be paid for achievement above 100%.
Employees and the Target Bonus Percentage Group
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Employee Position Target Bonus (% of Base
Salary)
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R Bucher CEO 60%
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M. Murphy VP Ops / Eng 40%
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S Moore CFO 40%
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G Deans VP Bus Dev 25%
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[non-executives]
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As the operating and engineering entities develop for services, products,
delivery channels, mergers and acquisitions and G&A functions, employees and
functions maybe added or deleted as the year progresses. They will be similar in
construction.
Addendum B
FY 2007 Commission Plans
Adept Technology, Inc.
List of Participants is made up of those executives responsible for revenue
growth of the company. There bonus compensation will be based on a "Revenue
Recognized" commission structure, at the end of each quarter. The list of
participant executives are: VP Worldwide Sales and Marketing and MD Europe Sales
and Service. Plans, targets and remunerations are outlined by job function as
follows.
VP WORLDWIDE SALES & MARKETING - FY 2007 REVENUE $XX
|_| Based on generating XX% commission
MD EUROPEAN SALES AND SERVICE OPERATIONS - FY 2007 REVENUE $XX
(sales and service revenue minus XX)
|_| Based on generating XX% commission
As the distribution entities develop for Distributor channels, Service products
and Control products, other plans maybe added as the year progresses. They will
be similar in construction.
Exhibit 10.2
ADEPT TECHNOLOGY, INC.
FY2007 RECOMMENDATIONS RE: STOCK COMPENSATION
The following is a review of the proposed guidelines for executive equity
compensation for Adept Technology, Inc ("Company").
Part 1: 10,000 Stock Option 90 Day Incentives
For fiscal FY2007, stock options would be based on completion of the 90-day
period with 2,500 shares potentially awardable each quarter under the 2005
Incentive Plan (the "Equity Plan"). The 90-day commitment is for 4-5 specific
projects or business milestones identified and completed in 90 days. The intent
of these project or business milestones is objective based. Due to
inter-dependencies, changing responsibilities and activities of the Company
business, a subjective component or weighting may be appropriate. The percentage
completion is up to the discretion and decision of the CEO after review with the
appropriate participant, and subject to review and approval of the Compensation
Committee.
The 90-day commitments should order 4 - 6 in number and will be defined as
either complete or incomplete. Each commitment must consolidate to the corporate
operational and financial goals and will require a written completion summary
for consideration. This should be completed prior to the submission of financial
and operational results to the Adept Board of Directors for approval and with
the new 5 goals / 90 day commitment for the next quarterly period.
Part 2 : Project Success Restricted Stock Plan
In addition specific individuals, regardless of position and on individual
approval by the BOD after consultation and recommendation by the CEO, would
receive "A" restricted stock if the company achieves the revenue target of $XX.
In addition specific participants, regardless of position and on individual
approval by the BOD after consultation and recommendation by the CEO, would
receive "B" restricted stock if the company achieves target revenues from each
of the 4 (four) key to successful growth or "MOONSHOT" projects.
The current amount of restricted stock equated to the MOONSHOT programs is up to
100,000 shares
The projects and weighting of the specific restricted stock awards are presented
in Addendum C.
The CEO, after review with the executive team, will present his recommendations
of individual and number of "A" plus "B" restricted shares to the BOD
compensation committee for approval prior to final BOD approval at the FY2007
review meeting. These rewards will be skewed towards, but limited to,
non-commissioned personnel.
Addendum C
FY 2007 Restricted Stock Award Guidelines
Adept Technology, Inc.
The restricted stock award will be based on and only on achieving a minimum
profit from the program during the fiscal year. The amount of stock and the
minimum profit is as follows:
Project 1 -4 described
The total pool of restricted stock will be determined following the final annual
audit results of FY2007.
Exhibit 10.3
Summary of Executive Compensation
The following is a summary of the compensation of Adept's "named executive
officers" as determined pursuant to Item S-K Rule 402(a)(3) for Adept's 2006
proxy statement.
Bonus Plan
Q4 FY 2006 Sales Target
Current Executive Comm.paid FY 2007 Annual Compensation Other Annual
Officers Base Salary (aggregated basis) Compensation
Robert H. Bucher Group term life insurance
Chief Executive Officer $ 340,000 60%(1) excess premiums
Matthew Murphy $ 276,864 40%(1) Automobile allowance exceeding
Vice President, Robotics $1,000
Group Group term life insurance
excess premiums
John Dulchinos $ 202,872 Sales commission % Housing allowance (over
Vice President, Emerging of revenue $32,000)
Markets
Group term life insurance
$21,853 excess premiums
Gordon Deans $ 207,000 (2) 25%(1) Health, life and disability
Vice President, Business insurance coverage (2)
Development and General
Manager - Canada
Steven L. Moore $ 220,000 40%(1) Group term life insurance
Chief Financial Officer(4) excess premiums
(1) All non-sales executive officers may earn up to the specified percentage of
base salary in cash bonus payments indicated above, as determined pursuant
to Adept's 2007 Executive Bonus Plan, upon attainment of certain corporate
targets specified therein. Sales executives are not eligible for cash
performance bonuses under the 2007 Executive Bonus Plan bonus component but
do receive commission payments based on individual performance against
specific revenue targets. This discussion does not include any option grant
compensation.
(2) Represents amounts in U.S. dollars, as calculated from salary payments of
Canadian $.
Additionally, Q4 2006 Sales Commission to Lee Blake of $18,942 approved.
Exhibit 10.4
ADEPT TECHNOLOGY, INC.
CODE OF BUSINESS CONDUCT
(updated as of November 14, 2006)
The ongoing commitment by the CEO, members of the Board of Directors, corporate
officers, and all employees of Adept Technology, Inc. is to comply with all laws
governing Adept's operations and to honor high legal and ethical standards in
the conduct of its business activities.
This means not only compliance with the law but also conducting Adept's business
in a manner that identifies Adept as an ethical and law-abiding enterprise,
alert to the responsibilities of good corporate citizenship. This Code of
Business Conduct ("Code") applies to all employees (including all officers) of
Adept Technology, Inc. and its subsidiaries, collectively referred to as "Adept"
or the "Company", and to the members of Adept's Board of Directors, subject to
the requirements of applicable laws. This Code of Business Conduct has been
designed to deter wrongful acts and to promote:
o The conduct of all Adept business with honesty, accountability,
integrity, and fairness.
o Compliance with all company policies and applicable governmental laws,
rules and regulations.
o Avoidance of acts that may be illegal or may appear to be unethical or
improper, or that involve an actual or apparent conflict of interest
between personal and professional obligations or relationships.
o Providing full, fair, accurate and timely disclosure in all reports
and documents that are filed with any government entity and in all
public communications made by Adept.
o Protection of Adept's confidential and proprietary information and
that of our customers, business partners, and suppliers.
o Seeking prompt guidance from a corporate executive officer (as named
under the heading "Management Team" on the Company's website at
www.adept.com) or, the Human Resources Administrator when in doubt
about his or her responsibilities under this Code of Business Conduct,
company policies, or the requirements of applicable laws or
regulations.
o Prompt reporting on a confidential basis to a corporate executive
officer, a member of the Nominating and Corporate Governance Committee
or, for Accounting Matters (as discussed below), the Audit Committee
of the Board of Directors any conduct involving Adept that appears to
be illegal, unethical, or improper or that may violate this Code of
Business Conduct or any Company policy. See the Compliance section
below for further details on reporting.
GENERAL/COMPLIANCE WITH LAWS
Managers at all levels are expected to foster a high standard of ethical conduct
and to ensure adherence to Company policies. They are also responsible for
maintaining a workplace environment that encourages and supports open
communication regarding compliance issues among employees and with management.
Responsibility and accountability for compliance with this Code of Business
Conduct rests with each employee and director. The unqualified recognition on
the part of all employees and directors of this responsibility is fundamental to
Adept's compliance program. Conduct not in compliance with both the letter and
the spirit of these requirements, including those set forth in Adept's company
policies, may be grounds for disciplinary action, which in serious cases may
include termination of employment and, if appropriate, referral to the relevant
governmental compliance authorities.
This Code outlines broad principles of legal and ethical business conduct
embraced by Adept. It is not a complete list of legal or ethical questions one
might face in the course of business, and therefore this Code must be applied
using common sense and good judgment. As a starting point, all directors and
employees are expected to comply with all applicable governmental laws, rules
and regulations. Additionally, under certain circumstances local country laws
may establish requirements that differ from this Code and in such cases, such
differing legal requirements will apply. Employees worldwide are expected to
comply with all local country laws and Adept business conduct policies in the
area in which they are conducting Adept business.
No individual is expected to know the details of all applicable laws, and
specific rules and regulations that may apply to particular kinds of work or to
individuals who work in particular areas. Individuals who have questions about
whether particular circumstances may involve illegal conduct, or about specific
laws that may apply to their activities, should consult the Human Resources
department who may seek and contact counsel, as needed.
It is Adept's policy to promote and implement prompt and consistent enforcement
of this Code, fair treatment for persons reporting unethical behavior, objective
and clear standards for compliance and a fair process by which to determine
violations of this Code or other Adept policies. It is against Adept policy to
retaliate against or harass any employee for good faith reporting of likely
violations of this Code or any other relevant Adept policy. Additionally, Adept
and applicable law prohibit any form of retaliation for raising concerns or
reporting misconduct in good faith and for assisting the investigation of
possible misconduct.
CONFLICTS OF INTEREST
Employees and directors are expected to make or participate in business
decisions and actions in the course of their employment with Adept based on the
best interests of the Company as a whole, and not based on personal
relationships or benefits. Conflicts of interest can compromise employees' and
directors' conduct and business decision making. Employees and directors are
expected to apply sound and reasonable judgment to avoid conflicts of interest
that could negatively impact Adept or its business. At Adept, a conflict of
interest is any activity that is inconsistent with or opposed to Adept's
interests, or gives the appearance of impropriety. Examples of potential
conflicts of interest include, but are not limited to those described below. If
you have any questions about whether a situation involves a possible conflict of
interest, please contact a corporate executive officer or the Human Resources
Administrator so that they may help provide guidance.
o Accepting or pursuing concurrent outside employment or consulting
relationships that conflict with Adept's business or create the
impression of a conflict of interest;
o Making material investments in Adept competitors;
o Making material investments in an entity which has a business
relationship with Adept in which the investing employee or director is
personally involved;
o Teaching, writing books or articles, or otherwise using knowledge
acquired while working at Adept in a manner that is viewed as adverse
to the business of Adept;
o Conducting business on behalf of Adept with any family member, or any
business which you may be deemed related to or in which you have a
financial or otherwise beneficial interest that could reasonably be
implied to be a conflict of interest with Adept's business;
o Serving on the Board of Directors or technical advisory board of any
other for profit entity that is reasonably viewed as competitive with
Adept's business; and
o Serving on the Board of Directors of any customer or other business
partner (such as a supplier).
A conflict of interest or potential conflict of interest may be resolved or
avoided if it is appropriately disclosed and approved. In some instances,
disclosure may not be sufficient and the Company may require that the conduct in
question be stopped or that actions taken be reversed where possible. You should
disclose any situation, transaction or relationship that may give rise to an
actual or potential conflict of interest to the Human Resources Administrator or
Chief Financial Officer, who will consult counsel as appropriate. Where the
individual involved in the matter is the Human Resources Administrator or Chief
Financial Officer, you should report such situation, transaction or relationship
that may give rise to an actual or potential conflict of interest to a member of
the Nominating and Corporate Governance Committee of the Board of Directors.
Additionally, directors should report actual or potential conflicts to a member
of the Nominating and Corporate Governance Committee of the Board of Directors.
SEC AND OTHER PUBLIC DISCLOSURES/RECORD-KEEPING
As a public company it is of critical importance that Adept's filings with the
Securities and Exchange Commission, other government agencies and any exchange
where Adept's securities are traded, be complete, accurate and timely. Depending
on their position with Adept, employees may be called upon to provide
information to assure that Adept's public reports fairly present Adept's
financial condition and results of operations, and are understandable. Employees
are responsible for maintaining books and records in appropriate detail to (i)
reflect the Company's transactions accurately and completely, (ii) accurately
and completely report financial information within their respective areas of
responsibility and (iii) timely notify senior management of financial and
non-financial information that may be material to the Company. Adept expects all
of its employees to take this responsibility very seriously and to provide
information that is accurate, complete, objective, and clear in reports and
documents that Adept files with, or submits to government agencies and in all
other public communications. All employees are expected to comply with the
Company's system of internal accounting controls. Transaction documentation
should fully and accurately describe the nature of the transaction. The Company
prohibits the use of "side letters," which are written or oral agreements with
customers and business partners that would modify or supersede the terms of
current or previous purchase orders or contracts. You should report the
existence of any side letter to the Chief Financial Officer.
Directors and employees will cooperate fully with and answer all inquiries of
the Company's independent accountants and internal auditors. Directors and
employees must never take any action to fraudulently influence, coerce,
manipulate, or mislead any external accountant or internal auditor engaged to
perform an audit of the Company's records and/or financial statements.
The consolidated financial statements of the Company shall conform to U.S.
generally accepted-accounting principles and the Company's accounting policies.
Local or statutory books and financial statements shall conform with local
regulatory statutes. No undisclosed or unrecorded account or fund shall be
established for any purpose. No false or misleading entries shall be made in the
Company's books or records for any reason, and no disbursement of corporate
funds or other corporate property shall be made without adequate supporting
documentation and authorization. See the Compliance section for information
regarding reporting concerns relating to accounting or auditing matters.
CONFIDENTIAL AND PROPRIETARY INFORMATION
Adept's business and business relationships center on the confidential and
proprietary information of Adept and of those with whom we do
business--customers, suppliers, and others. Each employee and director has the
duty to respect and protect the confidentiality of all such information and
should comply with the following requirements:
o Confidential information should be received and disclosed only under
the auspices of a written confidentiality agreement;
o Confidential information should be disclosed only to those Adept
employees who need to access it to perform their jobs for Adept;
o Confidential information of a third party should not be used or copied
by any Adept employee or director except as permitted in a written
agreement between Adept and an authorized third party representative;
o Unsolicited third party confidential information should be refused or,
if inadvertently received, returned unopened to the third party or
transferred to Adept's corporate office (Attention: Corporate
Secretary) for appropriate disposition;
o Employees must not use any confidential information belonging to any
former employers, and such information must not be brought to Adept or
provided to other Adept employees or directors.
o Confidential information should be disclosed to third parties only by
Adept employees or directors authorized to do so, and only when such
disclosure is appropriate in the furtherance of Adept's business and
strategic objectives. This should be done under a signed
Confidentiality Agreement, with a copy forwarded to the Corporate
Secretary.
Nonpublic information relating to Adept is the property of the Company and the
unauthorized disclosure of such information is forbidden. Legal rules govern the
timing and nature of Adept's disclosure of material information to outsiders or
the public. Violation of these rules could result in substantial liability for
the disclosing individual, Adept and its management. Further, even in the
context of information that may not be material, it is important to avoid
providing inaccurate, incomplete or otherwise inconsistent information to
outsiders, which could cause negative exposure and bad press from speculation or
misinformation about Adept. For this reason, the Company permits only
specifically designated representatives of Adept to discuss the Company with the
news media, securities analysts and investors in accordance with its policies.
In the event any officer, director or employee receives any inquiry from outside
the Company, such as a stock analyst, for information (particularly financial
results and/or projections), the inquiry should be referred to the Company's
Chief Financial Officer, who is responsible for coordinating and overseeing the
release of such information to the investing public, analysts and others in
compliance with applicable laws and regulations.
INSIDER TRADING
If an employee or director has material, non-public information relating to
Adept or its business, it is Adept's policy that the employee or director, their
family members, or any entities controlled by the employee, director or their
family members, may not buy or sell securities of Adept or engage in any other
action to take advantage of, or pass on to others, that information. This policy
also applies to trading in the securities of any other company, including our
customers, suppliers, or other business partners, if an employee or director has
material, non-public information about that company which the employee obtained
by virtue of his or her position with Adept.
Employees and directors should refer to the Company's Insider Trading Policy for
additional information and guidance on trading in the Company's stock.
GIFTS AND ENTERTAINMENT
Adept directors, employees and members of their families must not give or
receive valuable gifts (including gifts of equipment or money, discounts, or
favored personal treatment) either to or from any person associated with Adept
suppliers or customers. Advertising or promotional items, favors, and
entertainment are allowed when the following conditions are met:
o They are consistent with Adept's business practices and this Code;
o They do not violate any applicable law, such as state or federal
government procurement laws and regulations;
o They are not susceptible of being construed as a bribe or kickback;
o They are of limited or nominal value, not in cash, and are infrequent;
and
o Public disclosure of such items would not embarrass Adept.
FOREIGN OPERATIONS
Adept requires full compliance with the Foreign Corrupt Practices Act (FCPA) by
all of its directors, employees, agents, distributors, and resellers. The
anti-bribery and corrupt payment provisions of the FCPA make illegal any offer,
promise to pay, or payment of any money, gift, or anything of value to any
foreign official, or any foreign political party, candidate or official, for the
purpose of:
o Influencing any act, or failure to act, in the official capacity of
that foreign official or party, or
o Inducing the foreign official or party to use influence to affect a
decision of a foreign government or agency in order to obtain or
retain business for anyone, or direct business to anyone.
Payments, offers, promises or authorizations to pay any other person, U.S. or
foreign, are likewise prohibited if any portion of that money or gift will be
offered, given or promised to a foreign official or foreign political party or
candidate for the illegal purposes outlined above.
All employees, whether located in the United States or abroad, are responsible
for FCPA compliance and the procedures to ensure FCPA compliance. All managers
and supervisory personnel are expected to monitor continued compliance with the
FCPA while ensuring compliance with the highest moral, ethical, and professional
standards of the Company.
POLITICAL ACTIVITIES
The Company's funds and other assets may be used for, or contributed to,
political campaigns only in accordance with applicable laws governing political
contributions and with the prior written approval of the Chief Financial
Officer. Under U.S. law, the Company may not contribute corporate funds or
assets to candidates for federal offices. State and local laws also govern
political contributions and activities, and similar laws exist in other
countries.
You are free to participate in the political process, but you may not do so in a
manner that interferes with your responsibilities to the Company, creates the
impression that you are speaking or acting for the Company or implies the
Company's endorsement of your activities.
COMPETITION AND FAIR DEALING
Adept strives to compete vigorously and to gain advantages over our competitors
through superior business performance, not through unethical or illegal business
practices. No employee or director may, through improper means acquire
proprietary information of others, possess trade secret information, or induce
disclosure of confidential information from past employment, or from past or
present employees of other companies.
Adept employees are expected to deal honestly and fairly with Adept's customers,
suppliers, employees and anyone else with whom employees have contact in the
course of performing their duties to the Company. Statements regarding the
Company's products and services must not be untrue, misleading, deceptive or
fraudulent. Making false or misleading statements about competitors is
prohibited by this Code, inconsistent with Adept's reputation for integrity, and
harmful to its business. Adept employees and directors should not take unfair
advantage of anyone through misuse of confidential information,
misrepresentation of material facts or any other unfair business practice.
Employees involved in procurement have a special responsibility to adhere to
principles of fair competition in the purchase of products and services by
selecting suppliers based exclusively on normal commercial considerations such
as cost, quality, availability, service and reputation, and not on the receipt
of special favors.
Employees involved in sales have a special responsibility to abide by all
company policies regarding selling activities, including policies relevant to
revenue recognition by the Company.
Antitrust and competition laws generally prohibit practices that include:
o Agreements or arrangements between competitors that eliminate or
restrict their competition with each other, such as price fixing, bid
rigging, allocations of customers or territories, or agreements not to
deal with third parties;
o Other practices, such as exclusive dealing, price discrimination,
"tying" (conditioning the sale of a product on the purchase or sale of
another product), or resale price maintenance (conditioning the sale
of a product on a buyer's agreement to obtain a minimum price upon
resale), in circumstances where these practices have an unreasonable
impact on competition; and
o Disparaging or misrepresenting competitors' products, and stealing
trade secrets.
USE OF CORPORATE ASSETS
Adept provides computers and other equipment to employees as tools for
effectively and efficiently performing their duties. Adept employees are
expected to use this equipment responsibly for business purposes and keep it
properly maintained. If using portable equipment, Adept employees are expected
to take extra precautions against theft or damage.
Email is a convenient, quick and efficient method of communicating with other
employees, business partners and customers worldwide. Adept employees should use
appropriate business etiquette when sending and responding to email messages and
use the employee's corporate email account for business purposes only,
understanding that emails sent or received may be subject to Company review.
Messages should be constructed carefully, without haste, and avoid inappropriate
or unsubstantiated statements or any other statement that could embarrass or
create liability for Adept.
The Internet, particularly the worldwide web, is helpful in Adept Technology
operations. When accessing material via the internet, Adept employees should
focus on business related topics. Employees are referred to Adept's Internet Use
Policy for further information.
COMPLIANCE
Each Adept employee and director has the responsibility to promptly report
conduct involving Adept that appears to be illegal, unethical, or improper or
that may violate this Code of Business Conduct or any Company policy. Except for
Accounting Matters (as discussed below), an employee may satisfy this
requirement by making a report to the Human Resources Administrator, the
Corporate Secretary or a corporate executive officer or in the event a report
concerns the Human Resources Administrator or a corporate executive officer, to
the Chairman of the Nominating and Corporate Governance Committee of the Board
of Directors.
Complaints and concerns regarding accounting, internal accounting controls and
auditing matters (referred to as "Accounting Matters") should be directed to the
Audit Committee of the Board of Directors. For more information, refer to the
Company's Audit Committee Statement for Handling Accounting and Auditing
Complaints and Concerns. Anyone receiving such a report from another employee or
director must report to the Audit Committee.
The identity of the individual making a report will be kept confidential to the
maximum extent permitted by applicable law, rule or regulation. A report may be
made open or anonymously without fear of retaliation, discrimination or
harassment. All directors and employees have a duty to cooperate in the
investigation of reports of any conduct covered by this Code. All reports will
be taken seriously and investigated, with the specific action taken in any
particular case depending on the nature and gravity of the conduct or
circumstances reported and the quality of the information provided.
Communication with the Board may be accomplished confidentially on an open or
anonymous basis by sending a letter to member of the Board with whom you wish to
communicate or the Office of the Audit Committee, Adept Technology, Inc., 3011
Triad Drive, Livermore, CA 94551-9559 or by sending an email to
auditcommittee@adept.com.
The Nominating and Corporate Governance Committee is generally responsible for
overseeing this Code. Corporate executive officers, the Corporate Secretary and
the Human Resources Administrator are responsible for administering this Code
and investigating any reported violations with respect to the employees within
their organizations. The Nominating and Corporate Governance Committee is
responsible for administering this Code and overseeing the investigation of any
reported violations with respect to directors and corporate executive officers.
If the Human Resources Administrator, a corporate executive officer or the
Corporate Secretary receives information regarding an alleged violation of this
Code, he or she shall, as appropriate, (a) evaluate such information and
determine if the matter should be handled under the Company's Audit Committee
Statement of Procedures for Handling, Accounting and Auditing Complaints and
Concerns, (b) if the alleged violation is not an Accounting Matter but involves
a corporate executive officer or a director, inform a member of the Nominating
and Corporate Governance Committee of the alleged violation, (c) determine
whether it is necessary to conduct an informal inquiry or a formal investigation
and, if so, initiate such inquiry or investigation and (d) report the results of
any such inquiry or investigation, together with a recommendation as to
disposition of the matter, to the Nominating and Corporate Governance Committee
(or, for accounting matters, the Audit Committee, as indicated above) for
action, or if the alleged violation involves an corporate executive officer or a
director, report the results of any such inquiry or investigation to the Board
of Directors. Directors and employees are expected to cooperate fully with any
inquiry or investigation by the Company regarding an alleged violation of this
Code. Failure to cooperate with any such inquiry or investigation may result in
disciplinary action, up to and including discharge.
In the event that an alleged violation of this Code involves an employee, other
than an executive officer or director, the corporate executive officer and Chief
Financial Officer shall determine whether a violation of this Code has occurred
and, if so, shall determine the disciplinary measures to be taken against such
employee. In the event that the alleged violation involves a corporate executive
officer or a director, the Nominating and Corporate Governance Committee shall
determine whether a violation of this Code has occurred and, if so, shall
determine the disciplinary measures to be taken against such corporate executive
officer or director.
Complaints and concerns regarding accounting, internal accounting controls and
auditing matters will be handled as outlined in the Company's Audit Committee
Statement of Procedures for Handling Accounting and Auditing Complaints and
Concerns.
All employees and directors of Adept will be asked to certify in writing their
acknowledgement of receipt and review of the Code and compliance with the Code
substantially as follows (with such exceptions as may be noted therein):
SIGNATURE AND ACKNOWLEDGMENT REGARDING CODE OF BUSINESS CONDUCT
I have received and read the current version of the Company's Code of Business
Conduct, referred to as the Code. I understand the standards and policies
contained in the Code and understand that there may be additional policies or
laws specific to my job. I further agree to comply with the Code.
I understand that the Code is updated from time to time and that the current
version is maintained on the Company's intranet site and the Investor Relations
and Corporate Governance Section of the Adept website (www.adept.com), and I
agree to review any changes to the Code when I am notified that the Code has
been updated.
If I have questions concerning the meaning or application of the Code, any
Company policies, or the legal and regulatory requirements applicable to my job,
I know I can consult the Human Resources Department, knowing that my questions
or reports to these sources will be maintained in confidence.
- -------------------------------
Officer Name
- -------------------------------
Signature
- -------------------------------
Date
Please sign and return this form to the Human Resources Department
WAIVERS AND AMENDMENTS
Adept does not expect to grant waivers of this Code except in very limited
circumstances. Any waiver with respect to any member of the Board or corporate
executive officer may only be made by the Board or the Nominating and Corporate
Governance Committee, after disclosure of all material facts by the individual
seeking the waiver. Adept shall promptly disclose any such waiver with respect
to a director or corporate officer in a Form 8-K filed with the Securities and
Exchange Commission and/or on its website, as required by applicable law and
listing standards. Any waivers for other individuals may only be granted by the
Corporate Secretary or Human Resources Administrator after disclosure of all
material facts by the individual seeking the waiver.
The Company reserves the right to amend the Code at any time. The updated Code
will be available on the Company's website at all times.