Document:

ex10-5.htm

Exhibit 10.5

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (hereinafter "this Agreement") is made effective as of February 2, 2012 (the “Contract Date”), between Mediware Information Systems, Inc., (hereinafter "the Company") and Robert Watkins (hereinafter the “Executive").  The Executive’s shall become the Company’s Chief Financial Officer on February 15, 2012 (the “Effective Date”).

WHEREAS, the Company and the Executive desire that the Executive become the Company’s Chief Financial Officer.

NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements herein set forth, the Company and the Executive hereby agree as follows:

1. Employment. The Company hereby agrees to employ the Executive as the Chief Financial Officer, and the Executive hereby agrees to serve as the Company’s Chief Financial Officer, or in such other capacity as the parties may mutually agree commencing on the Effective Date. The Executive agrees to perform such services customary to such office as shall from time to time be assigned to him by the Chief Executive Officer or his designee.  The Executive further agrees to use his best efforts to promote the interests of the Company and to devote his full energies to the business and affairs of the Company.

 

2. Term of Employment. The employment hereunder shall be for a term of thirty-six months commencing on the Effective Date hereof and ending thirty-six months after the Effective Date hereof (the "'Expiration Date"), unless terminated earlier pursuant to Paragraph 4 of this Agreement (the "Term of Employment"). This Agreement shall automatically renew for successive terms of one (1) year (each a "Renewal Term") commencing on the first day immediately following the Expiration Date, unless such renewal is objected to by either the Company or the Executive by giving at least 90 days prior written notice prior to the scheduled Expiration Date. In the event of such renewal, the last day of each successive Renewal Term shall be deemed the Expiration Date.

3. Compensation and Other Related Matters.

(a) Salary. As compensation for services rendered hereunder, the Executive shall receive an Annual Base Salary of one hundred eighty thousand dollars ($180,000) commencing on the Effective Date, which salary shall be paid in accordance with the Company's then prevailing payroll practices for its executives and shall be subject to review annually by the Chief Executive Officer of the Board of Directors.

(b) Bonus.  For the period from the Effective Date through June 30, 2012, the Executive shall be eligible to receive an annual cash bonus of up to [$90,000*(N/366)] where N equals the number of days from the Effective Date through June 30, 2012 plus [$32,891*(O/366)] where O equals the number of days from July 1, 2011 to the Effective Date (the “First Annual Bonus”).  For each fiscal year, thereafter, the Executive shall be eligible to receive an annual cash bonus of up to 50% of Executive’s Annual Base Salary.  The bonus will be paid only if Executive achieves objectives established by the Company, subject to the discretion of the Chief Executive Officer and the Board of Directors.  The bonus, if any, would be payable after the conclusion of the annual audit. Executive shall only earn the bonus if he is an active employee as of the date the bonus is to be paid.

 

(c)           Stock Options. Subject to the approval of the Company's Board of Directors, the Executive shall be granted 30,000 non-qualified options (the "Options") to purchase shares of the Company's Common Stock, par value $.10 per share (the "Stock"), under a Company stock option plan. The Options shall be subject to the terms of the applicable Company stock option plan and the Executive's Stock Option Agreement (the "Option Agreement"), attached hereto as Exhibit "A". In addition to the terms set forth in the Option Agreement (provided that this Agreement shall govern the Options in the event of any conflict between this Agreement and the Option Agreement), the Company and the Executive agree as follows:

 

	
(i)  

	
Vesting. Subject to continued employment of the Executive, the Options shall vest and become exercisable as follows: Seven thousand five hundred (7,500) Options shall become exercisable on each of the first, second, third and fourth anniversary of the Contract Date.

 

  

  

  

 

	
(ii)  

	
Exercise. The Options shall be exercisable at a price equal to Fair Market Value (as defined in the Plan) on the Effective Date of this Agreement. The Options shall be exercisable (after vesting) for up to  five years from the commencement.

 

Notwithstanding the foregoing provisions, no options shall become vested and exercisable unless the Executive is Chief Financial Officer of the Company on February 15, 2012.

 

(d)           Performance Options.  Subject to the approval of the Company's Board of Directors, the Executive shall be granted 25,000 non-qualified performance options (the "Performance Options") to purchase shares of the Company's Common Stock, par value $.10 per share (the "Stock"), under a Company stock option plan. The Options shall be subject to the terms of the applicable Company stock option plan and the Executive's Stock Option Agreement (the "Option Agreement 2"), attached hereto as Exhibit "B". In addition to the terms set forth in the Option Agreement 2 (provided that this Agreement shall govern the Options in the event of any conflict between this Agreement and the Option Agreement), the Company and the Executive agree as follows:

 

	
(i)  

	
Vesting.  Subject to the continued employment of the Executive, the Performance Options shall vest and become exercisable as follows:

	
a.  

	
Up to 8,333 options shall vest upon the filing of the Company’s Form 10-K with the SEC for the Company’s 2012 fiscal year, subject to the Compensation Committee’s certification that the performance goals for the respective shares are achieved, which performance goals were established on or before the beginning of the 2013 fiscal year for the Company’s senior management--The total number of shares that vest (if any) will be determined formulaically based on the performance metrics achieved;

	
b.  

	
 Up to 8,333 shall vest upon the filing of the Company’s Form 10-K with the SEC for the Company’s 2013 fiscal year, subject to the Committee’s certification that the performance goals for the respective Covered Shares are achieved, which performance goals shall be established by the Committee on or before the beginning of the 2013 fiscal years--the total number of shares that vest (if any) will be determined formulaically based on the performance metrics achieved; and

	
c.  

	
Up to 8,334 shall vest upon the filing of the Company’s Form 10-K with the SEC for the Company’s 2014 fiscal year, subject to the Committee’s certification that the performance goals for the respective Covered Shares are achieved, which performance goals shall be established by the Committee on or before the beginning of the 2014 fiscal year—the total number of Covered Shares that vest (if any) will be determined formulaically based on the performance metrics achieved.

	
(ii)  

	
Exercise. The Performance Options shall be exercisable at a price equal to Fair Market Value (as defined in the Plan) on the Effective Date of this Agreement. The Performance Options shall be exercisable (after vesting) for five years from the Grant Date.

	
(iii)  

	
Forfeiture.  The Performance Options that are to vest pursuant to the terms of this Paragraph 3 shall vest upon approval by the Chief Executive and the Board of Directors of the performance objectives.  All Performance Options that do not vest as provided in subsections (i) a., (i) b. and (i) c above shall be forfeit.

 

	
(iv)  

	
Notwithstanding the foregoing provisions, no options shall become vested and exercisable unless the Executive is Chief Financial Officer of the Company on February 15, 2012.

 

  

  

  

 

(e) Other Benefits. The fringe benefits, perquisites and other benefits of employment, including four (4) weeks vacation each year, to be provided to the Executive shall be equivalent to such benefits and perquisites as are provided to other employees of the Company as amended from time to time.

(f) Reimbursement. Subject to policies established from time to time by the Company, the Company shall reimburse Executive for the reasonable expenses incurred by him in connection with the performance of his duties hereunder, including but not limited to, travel expenses and entertainment expenses, for which the Executive shall account to the Company in a manner sufficient to conform to Company policy and Internal Revenue Service requirements.

 

4. Termination.

(a) Disability. If, as a result of the incapacity of the Executive due to physical or mental illness, the Executive is unable to perform substantially and continuously the duties assigned to him hereunder for a period of three (3) consecutive months or for a non-consecutive period of nine (9) months during the Term of Employment, the Company may terminate his employment for "Disability" upon thirty (30) days prior written notice to the Executive.

(b) Death. The Executive's employment shall terminate immediately upon the death of the Executive.

(c) Cause. The Company shall be entitled to terminate the Executive's employment for "Cause." Termination by the Company of the employment of the Executive for "Cause" shall mean termination based upon (i) the willful failure by the Executive to follow directions communicated to him by the Chief Executive Officer or his designee; (ii) the willful engaging by the Executive in conduct which is materially injurious to the Company, monetarily or otherwise; (iii) a conviction of, a plea of nolo contendere, a guilty plea or confession by the Executive to an act of fraud, misappropriation or embezzlement or to a felony; (iv) the Executive's habitual drunkenness or use of illegal substances; (v) a material breach by the Executive of this Agreement; or (vi) an act of gross neglect or gross misconduct which the Company deems in good faith to be good and sufficient cause.  Executive hereby represents and warrants that he has never been convicted of an act of fraud, misappropriation, embezzlement or a felony, and Executive further warrants that during the Term of this Agreement, he will give the Company immediate notice of any charge against the Executive relating to any of the foregoing.

(d) Termination Without Cause. The Executive shall have the right to terminate the Executive's employment without cause at any time upon one ninety days prior written notice.  The Company shall have the right to terminate the Executive’s employment without cause at any time upon written notice.  The giving of notice by either party pursuant to Paragraph 2 to prevent the renewal of this Agreement shall not be deemed a termination of Executive’s employment without cause.

5. Compensation Upon Termination or During Disability

(a) Disability. During any period that the Executive fails to perform his full-time duties with the Company for a three-month period as a result of incapacity due to physical or mental illness (the "Disability Period"), the Executive shall continue to receive his Annual Base Salary at the rate set forth in Paragraph 3(a) of this Agreement, less any compensation payable to the Executive under the applicable disability insurance plan of the Company during the Disability Period, until this Agreement is terminated pursuant to Paragraph 4(a) hereof. Thereafter, or in the event the Executive's employment shall be terminated by reason of his death, the Executive's benefits shall be determined under the Company's insurance and other compensation programs then in effect in accordance with the terms of such programs and the Company shall have no further obligation to the Executive under this Agreement.

(b) Death. In the event of the Executive's death, the Executive's beneficiary shall be entitled to receive the Executive's Annual Base Salary at the rate set forth in Paragraph 3(a) of this Agreement until the date of his death. Thereafter, the Company shall have no further obligation to the Executive or the Executive's beneficiary under this Agreement.

(c) Cause. If the Executive's employment shall be terminated by the Company for "Cause" as defined in Paragraph 4(c) of this Agreement, the Company shall continue to pay the Executive his Annual Base Salary at the rate set forth in Paragraph 3(a) of this Agreement through the date of termination of the Executive's employment. Thereafter, the Company shall have no further obligation to the Executive under this Agreement.

 

  

  

  

(d) Termination Without Cause. If the Executive terminates his employment pursuant to Paragraph 4(d), the Executive shall be entitled to receive Executive’s Annual Base Salary at the rate set forth in Paragraph 3(a) of this Agreement until the date Executive’s employment ends.  Thereafter the Company shall have no obligation to Executive.  If the Company voluntarily terminates the Executive's employment with the Company pursuant to Paragraph 4(d) of this Agreement, the Company shall until the earlier of the three month anniversary of the termination of employment or the commencement of Executive’s employment at a successor employer, pay the Executive an amount equal to three months of the Executive's then current Annual Salary, payable in three equal monthly installments. Additionally, until the earlier of the three month anniversary of the termination of employment, or the commencement of the provision of health benefits to the Executive by a successor employer, the Executive will continue to receive the same coverage of health insurance as immediately before the date of the termination, at the expense of the Company. Thereafter, the Executive acknowledges that the Company shall have no further obligation to the Executive under this Agreement.  Notwithstanding the foregoing, the Company shall only be obligated to make the payments set forth in this section after the Executive delivers to the Company an executed Release and Severance Agreement, which shall be substantially in the form of Employer’s standard Release and Severance Agreement for all employees, with such changes therein or additions thereto as needed under then applicable law to give effect to its intent and purpose.  After the Executive is no longer receiving benefits from Mediware, the Executive shall be eligible for COBRA at Executive’s own expense in accordance with applicable law.

 

(e) Acquisition or Sale of Company. If a third party described in Paragraph 5(f) of this Agreement terminates the Executive due to "an acquisition or sale of the Company", as described in Paragraph 5(f) below, the Company shall pay the Executive an amount equal to six months of Executive's Annual Base Salary at the rate in effect at the date of termination of the Executive's employment during the period of the Executive's employment, payable in six equal monthly installments. Until the earlier of the six months after the termination of employment, or the commencement of the provision of health benefits to the Executive by a successor employer, the Executive will continue to receive the same coverage of health insurance as immediately before the date of the termination, at the expense of the Company. Thereafter, the Executive acknowledges that the Company shall have no further obligation to the Executive under this Agreement.  Notwithstanding the foregoing, the Company shall only be obligated to make the payments set forth in this section after the Executive delivers to the Company an executed Release and Severance Agreement, which shall be substantially in the form of Employer’s standard Release and Severance Agreement for all employees, with such changes therein or additions thereto as needed under then applicable law to give effect to its intent and purpose; and after delivery to the Company of a resignation from all offices, directorships and fiduciary positions with the Company, its affiliates and employee benefit plans.

(f) Definition. For purposes hereof, "an acquisition or sale of the Company" to or by "a third party" shall mean the occurrence of any transaction or series of transactions which within a six (6) month period result in (i) greater than fifty percent (50%) of the then outstanding shares of Common Stock of the Company (for cash, property including, without limitation, stock in any corporation or other third party legal entity, indebtedness or any combination thereof) have been redeemed by the Company or purchased by a third party not previously affiliated with the Company, or exchanged for shares in any other corporation or other third party legal entity not previously affiliated with the Company, or any combination of such redemption, purchase or exchange, (ii) greater than fifty percent (50%) in book value of the Company's gross assets are acquired by a third party not previously affiliated with the Company (for cash, property including, without limitation, stock in any corporation whether or not unaffiliated with the Company, indebtedness of any person or any combination thereof), or (iii) the Company is merged or consolidated with another private or public corporation or other third party legal entity and the former holders of shares of Common Stock of the Company own less than 25% of the voting power of the acquiring, resulting or surviving corporation or other third party legal entity. For the purposes hereof a director or officer of the Company shall be considered "affiliated with the Company."

6. Confidentiality and Restrictive Covenants.

(a) The Executive acknowledges that:

(i) the business in which the Company is engaged is intensely competitive and his employment by the Company will require that he have continual access to and knowledge of confidential information of the Company, including, but not limitedto, the nature and scope of its products, the object and source code offered, marketed or under development by the Company or under consideration by the Company for development, acquisition, or marketing by the Company and the documentation prepared or to be prepared for use by the Company (and the phrase "by the Company" shall include other vendors, licensees or and resellers and value-added resellers of the Company's products or proposed product) and the Company's plans for creation, acquisition, improvement or disposition of products or software, expansion plans, financial status and plans, products, improvements, formulas, designs or styles, method of distribution, lists of remarketing and value-added and other resellers customer lists and contact lists, product development plans, rules and regulations, personnel information and trade secrets of the Company, all of which are of vital importance to the success of the Company's business, provided that Confidential Information will not include information which has become publicly known otherwise than through a breach by Executive of the provisions of this Agreement (collectively, "Confidential Information");

 

  

  

  

(ii)  the direct or indirect disclosure of any Confidential Information would placethe Company at a serious competitive disadvantage and would do serious damage,financial and otherwise, to the Company's business;

(iii)  by his training, experience and expertise, the Executive's services to the Company will be special and unique; and

(iv)  if the Executive leaves the Company's employ to work for a competitive business, in any capacity, it would cause the Company irreparable harm.

(b)  Covenant Against Disclosure. The Executive therefore covenants and agrees that all Confidential Information relating to the business products and services of the Company, any subsidiary, affiliate, seller or reseller, value-added vendor or customer shall be and remain the sole property and confidential business information of the Company, free of any rights of the Executive. The Executive further agrees not to make any use of the confidential information except in the performance of his duties hereunder and not to disclose the information to third parties, without the prior written consent of the Company. The obligations of the Executive under this Paragraph 6 shall survive any termination of this Agreement. The Executive agrees that, upon any termination of his employment with the Company, all Confidential Information in his possession, directly or indirectly, that is in written or other tangible or readable form (together with all duplicates thereof) will forthwith be returned to the Company and will not be retained by the Executive or furnished to any third party, either by sample, facsimile, film, audio or video cassette, electronic data, verbal communication or any other means of communication.

(c)  Non-competition. The Executive agrees that, during the Term of Employment and for a period of one (1) year following the date of termination of the Executive's employment with the Company, the Executive will not own, manage,  or be connected as an officer, employee or director with, or aid or assist anyone else in the conduct of, any entity or business which competes with any business conducted by the Company or any of its subsidiaries or affiliates, in the United States, Canada and the UK and any other area where such business is being conducted on the date the Executive's employment is terminated hereunder. Notwithstanding the foregoing the Executive's ownership of securities of a public company engaged in competition with the Company not in excess of five (5%) percent of any class of such securities shall not be considered a breach of the covenants set forth in this Paragraph 6.

(d)  Further Covenant. Until the date which is one (1) year after the date of the termination of the Executive's employment hereunder for any reason, the Executive will not, directly or indirectly, take any of the following actions, and, to the extent the Executive owns, manages, operates, controls, is employed by or participates in the ownership, management, operation or control of, or is connected in any manner with, any business of the type and character engaged in and competitive with that conducted by the Company or any of its subsidiaries or affiliates during the period of the Executive's employment, the Executive will  not encourage or participate in any of the following actions on behalf of such business:

(i) persuade or attempt to persuade any customer of the Company or any seller, reseller or value-added vendor of the Company or of its products to cease doingbusiness with the Company or any of its subsidiaries or affiliates, or to reduce theamount of business it does with the Company or any of its subsidiaries or affiliates;

(ii) solicit for himself or any entity the business of (A) any customer of the Company or any of its subsidiaries or affiliates, or (B) any seller, reseller or-value-added vendor of the Company, or of its products, or (C) solicit any businessfrom a customer which was a customer of the Company or any of its subsidiaries or affiliates within six months prior to the termination of the Executive's employment; and

(iii) persuade or attempt to persuade any employee of the Company or any of its subsidiaries or affiliates or any individual who was an employee of the Companyor any of its subsidiaries or affiliates, at any time during the six-month period prior to the Executive's termination of employment , to leave the employ of the Company or any of its subsidiaries or affiliates.

7. Intellectual Property. The Executive hereby agrees that any and all (i) software, object code, source code, and documentation, (ii) any improvements, inventions, discoveries, formulae, processes, methods, know-how, confidential data, patents, trade secrets, (iii) Food and Drug Administrative ("FDA") applications seeking approval by the FDA, information contained in the Forms 510-k of the FDA and approvals from FDA, and (iv) other proprietary information made, developed or created by the Executive (whether at the request or suggestion of the Company or otherwise, whether alone or in conjunction with others, and whether during regular working hours of work or otherwise) during the period of his employment with the Company, which may be directly or indirectly useful in, or relate to, the business being carried out by the Company or any of its subsidiaries or affiliates, shall be promptly and fully disclosed by the Executive to the Board of Directors and shall be the Company's exclusive property as against the Executive, and the Executive shall promptly deliver to the Board of Directors of the Company all papers, drawings, models, data and other material relating to any invention made, developed or created by him as aforesaid.

 

  

  

  

The Executive shall, upon the Company's request and without any payment therefor, execute any documents necessary or advisable in the opinion of the Company's counsel to direct issuance of patents, copyrights and FDA applications or approvals of the Company with respect to such inventions or work product or improvements or enhancements as are to be the Company's exclusive property as against the Executive under this Paragraph 7 or to vest in the Company title to such inventions as against the Executive, the expense of securing any such patent or copyright, to be borne by the Company.

8. Breach by Employee. Both parties recognize that the services to be rendered under this Agreement by the Executive are special, unique and extraordinary in character, and that in the event of a breach by Employee of the terms and conditions of the Agreement to be performed by him, then the Company shall be entitled, if it so elects, to institute and prosecute proceedings in any court of competent jurisdiction, either in law or in equity, to enforce the specific performance thereof by the Executive. Without limiting the generality of the foregoing, the parties acknowledge that a breach by the Executive of his obligations under Paragraphs 6 or 7 would cause the Company irreparable harm, that no adequate remedy at law would be available in respect thereof and that therefore the Company would be entitled to seek injunctive relief with respect thereto.

9. Arbitration. Without precluding acting to obtain specific performance and/or injunctive relief pursuant to Paragraph 9 above, in the event of any dispute between the parties hereto arising out of or relating to this Agreement or the employment relationship, including, without limitation, any statutory claims of discrimination, between the Company and the Executive (except any dispute with respect to Paragraphs 6 and 7 hereof), such dispute shall be settled by arbitration in the City of Kansas City, State of Kansas, in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association. The parties hereto agree that the arbitral panel shall also be empowered to grant injunctive relief to a party, which may be included in any award. Judgment upon the award rendered, including injunctive relief, may be entered in any court having jurisdiction thereof. Notwithstanding anything herein to the contrary, if any dispute arises between the parties under Paragraphs 6 or 7, neither the Executive nor the Company shall be required to arbitrate such dispute or claim, but each party shall have the right to institute judicial proceedings the courts located in the City of Kansas City and the state of Kansas. If such judicial proceedings are instituted, the parties agree that such proceedings shall not be stayed or delayed pending the outcome of any arbitration proceeding hereunder.

10. Miscellaneous.

(a) Successors; Binding Agreement. This Agreement and the obligations of the Company hereunder and all rights of the Executive hereunder shall inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors and assigns, provided, however, that the duties of the Executive hereunder are personal to the Executive and may not be delegated or assigned by him.  By entering into this Agreement, the Executive’s prior employment agreement with the company is hereby terminated.

(b) Notice. All notices of termination and other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when delivered by hand, delivered by an express delivery (one day service), delivered by telefax and confirmed by express mail or one day express delivery service, or mailed by United States registered mail, return receipt requested, addressed as follows:

	 	
If to the Company:

	 	
Mediware Information Systems, Inc.

	 	
11711 West 79th Street

	 	
Lenexa, KS  66214

	 	
 

If to the Executive:

	 	
Robert Watkins

or to such other address as either party may designate by notice to the other, which notice shall be deemed to have been given upon receipt.

 

  

  

  

(c) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Kansas without regard to the conflict of law rules thereof.

(d) Waivers. The waiver of either party hereto of any right hereunder or of any failure to perform or breach by the other party hereto shall not be deemed a waiver of any other right hereunder or of any other failure or breach by the other party hereto, whether of the same or a similar nature or otherwise. No waiver shall be deemed to have occurred unless set forth in writing executed by or on behalf of the waiving party. No such written waiver shall be deemed a continuing waiver unless specifically stated therein, and each such waiver shall operate only as to the specific term or condition waived and shall not constitute a waiver of such term or condition for the future or as to any act other than that specifically waived.

(e) Validity. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall otherwise remain in full force and effect. Moreover, if any one or more of the provisions contained in this Agreement is held to be excessively broad as to duration, scope or activity, such provisions shall be construed by limiting and reducing them so as to be enforceable to the maximum extent compatible with applicable law.

(f) Counterparts. This Agreement may be executed in several counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument.

(g) Entire Agreement. This Agreement (including the applicable restricted stock agreements) sets forth the entire agreement and understanding of the parties in respect of the subject matter contained herein, and supersedes all prior agreements (including the prior employment agreements), promises, covenants, arrangements, communications, representations or warranties, whether oral or written, by any officer, employee or representative of either party in respect of said subject matter.

(i) Headings Descriptive. The headings of the several paragraphs of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any of this Agreement.

(j) Capacity. The Executive represents and warrants that he is not a party to any agreement that would prohibit him from entering into this Agreement or performing fully his obligations hereunder.

(k)  Indemnification.  The Executive, while serving as an officer and/or director of the Company, shall have the benefits of the applicable indemnification provisions set forth in the charter and By-laws of the Company and of the applicable insurance protections set forth in the Company’s applicable insurance policies.

IN WITNESS WHEREOF, the Company and the Executive have executed this Agreement as of the date first written above.

	
EXECUTIVE:

 

 

/s/ Robert Watkins

Robert Watkins

	
MEDIWARE INFORMATION SYSTEMS, INC:

 

 

By:      /s/ T. Kelly Mann

Name: T. Kelly Mann

Title:   President & Chief Executive OfficerADEP Ex 10.1 12-31-2011 Q2

Exhibit 10.1

AMENDMENT NO. 4 TO LOAN AND SECURITY AGREEMENT

This Amendment No. 4 to Loan and Security Agreement (this “Amendment”) is dated as of February 6, 2012 (the “Amendment 4 Date”), and is entered into by and between Adept Technology, Inc., a Delaware corporation (the “Borrower”), and Silicon Valley Bank (“Bank”).  Capitalized terms used herein without definition shall have the same meanings given them in the Loan Agreement (as defined below).  
Recitals
		
	A.
	Borrower and Bank have entered into that certain Loan and Security Agreement dated as of May 1, 2009 (as amended by that certain Amendment No. 1 to Loan and Security Agreement dated as of June 15, 2010, Amendment No. 2 to Loan and Security Agreement dated as of December 30, 2010, and Amendment No. 3 to Loan and Security Agreement dated as of March 25, 2010, and as such agreement may be further amended, restated or modified from time to time, the “Loan Agreement”), pursuant to which the Bank has agreed to extend and make available to Borrower certain advances of money.

		
	B.
	Borrower has informed Bank that it desires modifications to the Loan Agreement to modify the covenant structure and make certain other changes to the Loan Agreement, in each case as more fully set forth in this Amendment. 

		
	C.
	Subject to the representations and warranties of Borrower and upon the terms and conditions set forth in this Amendment, Bank is willing to so amend the Loan Agreement and to make the changes set forth in this Amendment.

Agreement
Now, therefore, in consideration of the foregoing Recitals and intending to be legally bound, the parties hereto agree as follows:
		
	1.
	Amendments to Loan Agreement.

		
	1.1
	Sections 2.1.2 (Letters of Credit Sublimit), 2.1.3 (Foreign Exchange Sublimit) and 2.1.4 (Cash Management Services Sublimit).  Sections 2.1.2, 2.1.3, and 2.1.4 of the Loan Agreement are hereby deleted from the Loan Agreement.

		
	2.2
	Section 2.2 (Overadvances).  Section 2.2 of the Loan Agreement is amended in its entirety to read as follows:

“2.2    Overadvances.  If, at any time, (X) the Dollar Equivalent of the aggregate outstanding principal amount of Advances exceeds the lesser of the Revolving Line and the Borrowing Base, or (Y) the sum of all Obligations under (i) this Agreement and (ii) the EXIM Loan Agreement exceeds $10,000,000, then Borrower shall immediately pay to Bank in cash such excess.”
		
	1.3
	Section 2.4(b) (Letter of Credit Fee).  Section 2.4(b) of the Loan Agreement is amended in its entirety to read as follows:

“        (b)    EXIM Renewal Fee.  A facility fee of $50,000 (the “EXIM Facility Fee”), which fee shall be fully earned, non-refundable, due, and payable on March 25, 2012” 
		
	1.4
	Section 2.4(c) (Unused Revolving Line Facility Fee).  Section 2.4(c) of the Loan Agreement is amended in its entirety to read as follows:

“        (c)    Unused Revolving Line Facility Fee.  A fee (the “Unused Revolving Line Facility Fee”), payable quarterly, in arrears, on a calendar year basis, in an amount equal to 0.50% per annum of the average unused portion of the Revolving Line, as determined by Bank.  The unused portion of the Revolving Line, for the purposes of this calculation, equal the difference between (x) the Revolving Line amount (as it may be reduced from time to time) and (y) the average for the period of the daily closing balance of the Revolving Line outstanding.  Borrower shall not be entitled to any credit, rebate or repayment of any Unused Revolving Line Facility Fee previously earned by Bank pursuant to this Section notwithstanding any termination of the Agreement or the suspension or termination of Bank's obligation to make loans and advances hereunder;” 
		
	1.5
	Section 2.4(d) (Collateral Monitoring Fee).  Section 2.4(d) of the Loan Agreement is amended in its entirety to read as follows:

“        (d)    Collateral Monitoring Fee.  A monthly collateral monitoring fee of $850 per month (the “Collateral Monitoring Fee”) payable in arrears on the last calendar day of each month if there was any principal or  interest outstanding under the Revolving Line during the month;” 
		
	1.6
	Section 4.1 (Grant of Security Interest).  Section 4.1 of the Loan Agreement is amended by appending the following to the end of that section:

“Borrower acknowledges that it previously has entered, and/or may in the future enter, into Bank Services Agreements with Bank.  Regardless of the terms of any Bank Services Agreement, Borrower agrees that any amounts Borrower owes Bank thereunder shall be deemed to be Obligations hereunder and that it is the intent of Borrower and Bank to have all such Obligations secured by the first priority perfected security interest in the Collateral granted herein (subject only to Permitted Liens that may have superior priority to Bank's Lien in this Agreement).  Borrower agrees that, unless otherwise agreed in writing signed by Bank and Borrower, the security interest granted herein by Borrower shall survive the termination of this Agreement and shall terminate only upon the termination of all Bank Services Agreements.”
		
	1.7
	Section 6.2 (Financial Statements, Reports, Certificates).  Section 6.2(a) of the Loan Agreement is amended in its entirety to read as follows:

“        (a)    Monthly, within 30 days after the last day of each month, a duly completed Transaction Report Signed by a Responsible Officer, with aged listings of accounts receivable and accounts payable (by invoice date), provided that such Transaction Report shall be due weekly if there is any principal or interest outstanding under the Revolving Line”
		
	1.8
	Section 6.2 (Financial Statements, Reports, Certificates).  The “and” at the end of Section 6.2(h) of the Loan Agreement is deleted, the “.” at the end of Section 6.2(i) of the Loan Agreement is replaced by “; and”, and a new Section 6.2(j) is added to the Loan Agreement as follows:

“        (j)     monthly, as soon as available but no later than five days following Borrower's receipt of each, complete copies of all account statements for accounts maintained with Wells Fargo Bank.”
		
	1.9
	Sections 6.3(c)(ii) (Application of Payment).  Section 6.3(c)(ii) of the Loan Agreement is amended in its entirety to read as follows:

“            (ii)    Application of Payments.  Subject to Section 9.4, Bank will apply proceeds of Borrower's Accounts received by Bank (the “Collections”) towards the Obligations and will turn over any excess amounts to the Borrower.”
		
	1.10
	Section 6.8 (Financial Covenants).  Section 6.8 of the Loan Agreement is amended in its entirety to read as follows:

		
	“
	(a)    Liquidity.  Measured as of the end of each month, Liquidity of not less than $3,500,000.

(b)    Minimum Quarterly EBITDA.  Measured as of the end of each fiscal quarter indicated below, aggregate EBITDA for such fiscal quarter of not less than the following:
	
				
	Quarter Ending
	Minimum 
Quarterly EBITDA

	December 31, 2011
	$
	(1,000,000
	)

	March 31, 2012
	$
	(500,000
	)

	June 30, 2012
	$
	(500,000
	)

	September 29, 2012
	$
	(250,000
	)

	December 29, 2012
	$
	—
	

	March 30, 2013
	$
	250,000
	

	June 30, 2013 
and thereafter
	$
	500,000
	

 
		
	1.11
	Section 8.10 (Guaranty).  Section 8.10 of the Loan Agreement is amended in its entirety to read as follows:

“8.10    Guaranty.  (a) Any Guarantor's guaranty of any Obligations terminates or ceases for any reason to be in full force and effect (other than as a result of the Anticipated Liquidations); (b) any Guarantor does not perform any obligation or covenant under any guaranty of the Obligations; (c) any circumstance described in Sections 8.4, 8.5, 8.7, or 8.8. occurs with respect to any Guarantor, (d) the liquidation, winding 

up, or termination of existence of any Guarantor (other than as part of the Anticipated Liquidations); or (e) (i) a material impairment in the perfection or priority of Bank's Lien in the collateral provided by Guarantor or in the value of such collateral or (ii) a material adverse change in the business, operation, condition (financial or otherwise), or the prospect of repayment of the Obligations occurs with respect to any Guarantor.”
		
	1.12
	Section 9.1 (Rights and Remedies).  Sections 9.1(c) and (d) of the Loan Agreement are amended in their entirety to read as follows:

“        (c)    for any Letters of Credit, demand that Borrower (i) deposit cash with Bank in an amount equal to 105% of the Dollar Equivalent of the aggregate face amount of all Letters of Credit remaining undrawn (plus all interest, fees, and costs due or to become due in connection therewith (as estimated by Bank in its good faith business judgment)), to secure all of the Obligations relating to such Letters of Credit, as collateral security for the repayment of any future drawings under such Letters of Credit, and Borrower shall forthwith deposit and pay such amounts, and (ii) pay in advance all letter of credit fees scheduled to be paid or payable over the remaining term of any Letters of Credit;
(d)    terminate any FX Contracts;”
		
	1.13
	Section 12.8 (Survival).  Section 12.8 of the Loan Agreement is amended in its entirety and replaced by the following:

“12.8    Survival.  All covenants, representations and warranties made in this Agreement continue in full force until this Agreement has terminated pursuant to its terms and all Obligations (other than inchoate indemnity obligations and any other obligations which, by their terms, are to survive the termination of this Agreement) have been satisfied.  The grant of security interest by Borrower in Section 4.1 shall survive until the termination of all Bank Services Agreements, and the obligation of Borrower in Section 12.2 to indemnify Bank shall survive until the statute of limitations with respect to such claim or cause of action shall have run.“
		
	1.14
	Section 12.11 (Termination Prior to Revolving Maturity Date).  A new Section 12.11 is added to the Loan Agreement as follows:

“12.11    Termination Prior to Revolving Line Maturity Date.  This Agreement may be terminated by Borrower as provided in Section 2.1.1(b).  Notwithstanding any termination of this Agreement, Bank's lien and security interest in the Collateral shall continue until Borrower fully satisfies its Obligations and until the termination of all Bank Services Agreements.  If this Agreement is terminated at Borrower's election or at Bank's election due to the occurrence and continuance of an Event of Default, Borrower shall pay to Bank, in addition to the payment of any other expenses or fees then-owing, a termination fee in an amount equal to one percent (1.0%) of the Revolving Line, provided that no termination fee shall be charged if the credit facility hereunder is replaced with a new facility from another division of Bank.”
		
	1.15
	Section 13 (Definitions). The following definitions in Section 13 of the Loan Agreement are hereby deleted from that Section:  “Asset Based Threshold,” “Cash Management Services,” “FX Business Day,” “FX Forward Contract,” “FX Reduction Amount,” “FX Reserve,” “LC Application,” “LC Reserve,” and “Settlement Date.”

		
	1.16
	Section 13 (Definitions).  The following definitions are hereby: (a) to the extent already defined in Section 13.2 of the Loan Agreement, amended in their entirety to read as follows, and (b) to the extent not already defined in that Section, added to Section 13.2 of the Loan Agreement:

““Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) the amount available under the Borrowing Base, in either case minus (b) the Dollar Equivalent of the outstanding principal balance of any Advances (including EXIM Advances).”
““Bank Services”  are any products, credit services, and/or financial accommodations previously, now, or hereafter provided to Borrower or any of its Subsidiaries by Bank or any Bank Affiliate, including, without limitation, any letters of credit, cash management services (including, without limitation, merchant services, direct deposit of payroll, business credit cards, and check cashing services), interest rate swap arrangements, and foreign exchange services as any such products or services may be identified in Bank's various agreements related thereto (each, a “Bank Services Agreement”).”
““Bank Services Agreement” is defined in the definition of Bank Services.”
““Business Day” is any day that is not a Saturday, Sunday or other day on which banking institutions in the State of California are authorized or required by law or other governmental action to close, except that if any determination of a “Business Day” shall relate to a FX Contract, the term “Business Day” shall mean a day on which dealings are carried on in the country of settlement of the applicable Foreign Currency.”

““Credit Extension” is any Advance, EXIM Advance, or any other extension of credit by Bank for Borrower's benefit under this Agreement.”
““EXIM Facility Fee” is defined in Section 2.4(b).”
““FX Contract” is is any foreign exchange contract by and between Borrower and Bank under which Borrower commits to purchase from or sell to Bank a specific amount of Foreign Currency on a specified date.”
““Letter of Credit” is a standby or commercial letter of credit issued by Bank upon request of Borrower based upon an application, guarantee, indemnity, or similar agreement.”
““Liquidity”  means, on any date, (1) Domestic Cash plus (2) the Availability Amount then available to Borrower.”
““Loan Documents” are, collectively, this Agreement, the EX-IM Loan Documents, the Perfection Certificates, the IP Agreement, any Bank Services Agreements, any note, or notes or guaranties executed by Borrower or any Guarantor, any other present or future agreement between Borrower or any Guarantor (or among any Guarantors) for the benefit of Bank (whether or not in connection with this Agreement), all as amended, restated, or otherwise modified.”
““Obligations” is Borrower's obligation to pay when due any debts, principal, interest, Bank Expenses and other amounts Borrower owes Bank now or later, whether under this Agreement, the Loan Documents, or otherwise, including, without limitation, any interest accruing after Insolvency Proceedings begin and debts, liabilities, or obligations of Borrower  assigned to Bank, and the performance of Borrower's duties under the Loan Documents.”
““Perfection Certificate” means each original Perfection Certificate delivered by Borrower or a Guarantor to Bank as described in Section 5.1 of the Loan Agreement or in connection with such Guarantor's delivery of documentation to Bank causing such Subsidiary to become a guarantor of the Obligations as provided in Section 6.13 of this Agreement, as updated by each additional Perfection Certificate delivered by Borrower or such Guarantor to Bank, and accepted by Bank, prior to February 6, 2012, and the Perfection Certificates of Borrower and Guarantors delivered to Bank in accordance with, and accepted by Bank to satisfy the conditions precedent in, Section 5 of that certain Amendment No. 1 to Loan and Security Agreement dated as of February 6, 2012, that amends the EX-IM Loan Agreement.”
		
	1.17
	Exhibit C to Loan Agreement (Form of Compliance Certificate).  Exhibit C to the Loan Agreement is hereby amended in its entirety by deleting it and replacing it with Exhibit C attached to this Amendment. 

		
	2.
	Borrower's Representations and Warranties.  

		
	2.1
	Borrower represents and warrants that: 

		
	(a)
	immediately upon giving effect to this Amendment, (i) the representations and warranties contained in the Loan Documents are true, accurate and complete in all material respects as of the date hereof (except to the extent such representations and warranties relate to an earlier date, in which case they are true and correct as of such date) and (ii) no Event of Default has occurred and is continuing;

		
	(b)
	Borrower has the corporate power and authority to execute and deliver this Amendment and to perform its obligations under the Loan Agreement, as amended by this Amendment;

		
	(c)
	the certificate of incorporation, bylaws, and other organizational documents of Borrower (i) delivered to Bank in connection with the execution of this Amendment, are true, accurate and complete and continue to be in full force and effect and (ii) delivered to Bank in connection with the execution of the Loan Agreement (except to the extent updates thereof have been delivered to Bank in connection with the execution of this Amendment), remain true, accurate and complete and have not been amended, supplemented or restated and are and continue to be in full force and effect;

		
	(d)
	the execution and delivery by Borrower of this Amendment and the performance by Borrower of its obligations under the Loan Agreement, as amended by this Amendment, have been duly authorized by all necessary corporate action on the part of Borrower;

		
	(e)
	this Amendment has been duly executed and delivered by the Borrower and is the binding obligation of Borrower, enforceable against it in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or other similar laws of general application and equitable principles relating to or affecting creditors' rights; and

		
	(f)
	as of the date hereof, it has no defenses against the obligations to pay any amounts under the Obligations.  Borrower acknowledges that Bank has acted in good faith and has conducted in a commercially reasonable manner its relationships with Borrower in connection with this Amendment and in connection with the Loan Documents.

		
	2.2
	Borrower understands and acknowledges that Bank is entering into this Amendment in reliance upon, and in partial consideration for, the representations and warranties in Section 2.1, and agrees that such reliance is reasonable and appropriate.

		
	3.
	Limitation.  The amendments set forth in Section 1 shall be limited precisely as written and shall not be deemed (a) to be a waiver or modification of any other term or condition of the Loan Agreement or of any other instrument or agreement referred to therein or to prejudice any right or remedy which Bank may now have or may have in the future under or in connection with the Loan Agreement or any instrument or agreement referred to therein; or (b) to be a consent to any future amendment or modification or waiver to any instrument or agreement the execution and delivery of which is consented to hereby, or to any waiver of any of the provisions thereof.  Except as expressly amended hereby, the Loan Agreement shall continue in full force and effect.  All other Loan Documents shall continue in full force and effect.  This Amendment is a Loan Document.

		
	4.
	Effectiveness.  This Amendment shall become effective upon the satisfaction of all of the following conditions precedent:

		
	4.1
	Amendment Execution.  Borrower and Bank shall have duly executed and delivered this Amendment and that certain Amendment No. 1 to Loan and Security Agreement (EX-IM Loan Facility) dated as of even date herewith;

		
	4.2
	Reaffirmation of Guaranty.  Each Guarantor shall have duly executed and delivered to Bank the Reaffirmation of Unconditional Secured Guaranty substantially in the form of Exhibit A to this Amendment. 

		
	4.3
	Bank Expenses.  Borrower shall have paid all Bank Expenses incurred through the date of this Amendment.

		
	5.
	Counterparts.  This Amendment may be signed in any number of counterparts, and by different parties hereto in separate counterparts, with the same effect as if the signatures to each such counterpart were upon a single instrument.  All counterparts shall be deemed an original of this Amendment.

		
	6.
	Integration.  This Amendment and any documents executed in connection herewith or pursuant hereto contain the entire agreement between the parties with respect to the subject matter hereof and supersede all prior agreements, understandings, offers and negotiations, oral or written, with respect thereto and no extrinsic evidence whatsoever may be introduced in any judicial or arbitration proceeding, if any, involving this Amendment; except that any financing statements or other agreements or instruments filed by Bank with respect to Borrower shall remain in full force and effect.

		
	7.
	Governing Law; Venue.  THIS AMENDMENT SHALL BE GOVERNED BY AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.  Borrower and Bank each submit to the exclusive jurisdiction of the State and Federal courts in Santa Clara County, California.

[Remainder of page intentionally left blank - signature page follows]

IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 4 to Loan and Security Agreement to be executed as of the Amendment Date.

		
	Borrower:
	Adept Technology, Inc.

a Delaware corporation
By:    /s/ Lisa M. Cummins_____             
Printed Name:       Lisa M. Cummins              
Title:     Senior Vice President, Finance &
Chief Financial Officer              

    
		
	Bank:
	Silicon Valley Bank

By:          /s/ Elisa Sun                                                  
Printed Name:   Elisa Sun                                    
Title:        Relationship Manager                           

Exhibit A 

Reaffirmation of Unconditional Secured Guaranty
(Amendment No. 4)
This Reaffirmation of Unconditional Secured Guaranty (Amendment No. 4) is entered into as of February 6, 2012, by the undersigned guarantors (the “Guarantors”) in favor of Silicon Valley Bank (“Bank”).
		
	Whereas, 
	Guarantors executed and delivered to Bank that certain Unconditional Secured Guaranty dated as of May 1, 2009 (the “Guaranty”), with respect to the obligations of Adept Technology, Inc. (“Borrower”) under that certain Loan and Security Agreement dated as of May 1, 2009 by and between Borrower and Bank (as amended, restated, supplemented, or otherwise modified from time to time, the “Loan Agreement”);

		
	Whereas, 
	Borrower and Bank have now agreed to amend the Loan Agreement to modify the covenant structure andmake certain other changes to the Loan Agreement, as described more fully in that certain Amendment No. 4 to Loan and Security Agreement dated as of the date hereof (the “Amendment”).

Now, therefore, for valuable consideration, receipt of which is acknowledged, Guarantors hereby agree as follows:
		
	1.
	Reaffirmation of Guaranty.  Guarantors jointly and severally hereby ratify and reaffirm their own and each other's obligations under the Guaranty and agree that Guaranty secures the obligations under the EXIM Loan Agreement, that the obligations under the EXIM Loan Agreement are obligations under the Loan Agreement, and that nothing contained in the Amendment shall impair Guarantors joint or several obligations under the Guaranty or Bank's rights under the Guaranty.

		
	2.
	Continuing Effect and Absence of Defenses.  Each Guarantor acknowledges that the Guaranty is still in full force and effect and that no Guarantor has any defenses, other than actual payment of the guaranteed obligations, to enforcement of the Guaranty.  Each Guarantor waives any and all defenses to enforcement of the Guaranty that might otherwise be available as a result of the Amendment.

[Remainder of page intentionally left blank - signature page follows]

IN WITNESS WHEREOF, the parties hereto have caused this Reaffirmation of Unconditional Secured Guaranty (Amendment No. 4) to be executed as of the date first noted above.

	
		
	ADEPT TECHNOLOGY INTERNATIONAL, LTD., a California corporation

By:/s/ Lisa M. Cummins
Printed Name:Lisa M. Cummins
Title:Chief Financial Officer
	ADEPT TECHNOLOGY HOLDINGS, INC., a Delaware corporation 

By:/s/ Lisa M. Cummins
Printed Name:Lisa M. Cummins
Title:Chief Financial Officer

	ADEPT TECHNOLOGY CANADA HOLDING CO., a Nova Scotia unlimited liability company

By:/s/ Lisa M. Cummins
Printed Name:Lisa M. Cummins
Title:Chief Financial Officer
	ADEPT TECHNOLOGY CANADA CO., a Nova Scotia unlimited liability company

By:/s/ Lisa M. Cummins
Printed Name:Lisa M. Cummins
Title:Chief Financial Officer

	ADEPT INMOTX, INC., 
a Delaware corporation

By:/s/ Lisa M. Cummins
Printed Name:Lisa M. Cummins
Title:Chief Financial Officer
	ADEPT MOBILEROBOTS LLC, 
a Delaware limited liability company 

By:/s/ Lisa M. Cummins
Printed Name:Lisa M. Cummins
Title:Chief Financial Officer

EXHIBIT B INTENTIONALLY OMITTED

EXHIBIT C

FORM OF COMPLIANCE CERTIFICATE

TO:        Silicon Valley Bank                    Date:                  
FROM:      Adept Technology, Inc.

The undersigned authorized officer of Adept Technology, Inc. (“Borrower”) certifies that under the terms and conditions of the Loan and Security Agreement dated as of May 1, 2009, by and between Borrower and Bank (as amended, the “Agreement”), (1) Borrower is in complete compliance for the period ending _______________ with all required covenants except as noted below, (2) there are no Events of Default, (3) all representations and warranties in the Agreement are true and correct in all material respects on this date except as noted below; provided, however, that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof; and provided, further that those representations and warranties expressly referring to a specific date shall be true, accurate and complete in all material respects as of such date, (4) Borrower, and each of its Subsidiaries, has timely filed all required tax returns and reports, and Borrower has timely paid all foreign, federal, state and local taxes, assessments, deposits and contributions owed by Borrower except as otherwise permitted pursuant to the terms of Section 5.9 of the Agreement, and (5) no Liens have been levied or claims made against Borrower or any of its Subsidiaries relating to unpaid employee payroll or benefits of which Borrower has not previously provided written notification to Bank.  Attached are the required documents supporting the certification.  The undersigned certifies that the financial statements included within these documents are prepared in accordance with GAAP consistently applied from one period to the next except as explained in an accompanying letter or footnotes.  The undersigned acknowledges that no borrowings may be requested at any time or date of determination that Borrower is not in compliance with any of the terms of the Agreement, and that compliance is determined not just at the date this certificate is delivered.  Capitalized terms used but not otherwise defined herein shall have the meanings given them in the Agreement.

	
			
	Please indicate compliance status by circling Yes/No under “Complies” column.

	 

	Reporting Covenants
	Required
	Complies

	Transaction Report (incl. A/R & AP Agings)
	Weekly*, otherwise Monthly, within 30 days
	Yes   No

	Company prepared financial statement
	Monthly, within 30 days
	Yes   No

	Compliance Certificate
	Monthly, within 30 days
	Yes   No

	Wells Fargo Bank Statements
	Monthly, as soon as available
	Yes   No

	Invoices representing ≥ 10% all outstanding EXIM Eligible Foreign Accounts (as reported at such quarter-end)
	Quarterly, within 30 days
	Yes   No

	Invoices representing ≥ 10% of EXIM Export Orders for such quarter
	Quarterly, within 30 days
	Yes   No

	Audited Financial Statements
	Annually, within 120 days of FYE
	Yes   No

	Board approved financial projections etc.
	Annually, upon board approval
	Yes   No

	10‐Q, 10‐K and 8-K
	Within 5 days after filing with SEC
	Yes   No

	* weekly Transaction Report only required if there is any principal or interest outstanding under the Revolving Line.

	The following Intellectual Property was registered (or a registration application submitted) after the Effective Date (if no 
registrations, state “None”)
_________________________________________________________________________________________
_________________________________________________________________________________________

	
				
	Financial Covenants
	Required
	Actual
	Complies

	Maintain at all times:
	 
	 
	 

	Liquidity
	≥ 3,500,000
	$_________
	Yes   No

	Minimum Quarterly EBITDA (tested quarterly)
	December 31, 2011≥ $(1,000,000)
March 31, 2012≥ $(   550,000)
June 30, 2012≥ $(   500,000) 
September 29, 2012≥ $(  250,000)
December 29, 2012≥ $0
March 30, 2013≥ $    250,000 
June 30, 2013 and thereafter≥ $    500,000 
	$_________
	Yes   No

The following financial covenant analys[is][es] and information set forth in Schedule 1 attached hereto are true and accurate as of the date of this Certificate.

The following are the exceptions with respect to the certification above:  (If no exceptions exist, state “No exceptions to note")__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

	
		
	Adept Technology, Inc.

By: 
Name: 
Title: 

	BANK USE ONLY

Received by: _____________________
authorized signer
Date: _________________________

Verified: ________________________
authorized signer
Date: _________________________

Compliance Status:Yes     No

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