8-KOther Events

CISCO SYSTEMS, INC. 8-K Report, Corporate Update (Aug 24, 2011)

Filed August 24, 2011For Securities:CSCO

Summary

This Form 8-K filing by Cisco Systems, Inc. (CSCO) reports on a pre-arranged stock trading plan adopted by its Chairman and CEO, John T. Chambers. The plan, established on August 23, 2011, allows Mr. Chambers to exercise stock options originally granted in 2003 and set to expire between April and July 2012. He is authorized to sell up to 4,000,000 shares acquired through these option exercises. The trading plan is designed to comply with Rule 10b5-1 of the Securities Exchange Act of 1934, ensuring that transactions are conducted without the need for possession of material non-public information at the time of the plan's adoption. This allows for a structured and diversified approach to managing his investment portfolio. The plan is scheduled to conclude in June 2012, with all transactions to be publicly disclosed via Form 144 and Form 4 filings.

Key Highlights

  • 1Cisco CEO John T. Chambers adopted a pre-arranged stock trading plan.
  • 2The plan involves exercising stock options granted in 2003, which are set to expire between April and July 2012.
  • 3Mr. Chambers may sell up to 4,000,000 shares of Cisco stock under this plan.
  • 4The trading plan is designed to comply with Rule 10b5-1, facilitating sales without regard to current material non-public information.
  • 5The plan is scheduled to terminate in June 2012.
  • 6All transactions under the plan will be publicly disclosed via Form 144 and Form 4 filings.

Frequently Asked Questions

The primary purpose of this 8-K filing is to inform the public that Cisco's Chairman and CEO, John T. Chambers, has adopted a pre-arranged stock trading plan for exercising stock options and selling company shares.

This plan is significant as it outlines a structured approach for the CEO to diversify his holdings by selling a substantial number of shares over a period. It also adheres to Rule 10b5-1, which allows executives to trade stock even during periods when they might otherwise be restricted due to insider information, providing a level of transparency and predictability.

A 'pre-arranged' plan under Rule 10b5-1 means that the trades are predetermined at a time when the executive does not possess material, non-public information. This allows executives to sell or buy shares systematically over time, mitigating concerns that trades are based on inside knowledge.

The plan is set to terminate in June 2012, and transactions will occur between the adoption date (August 23, 2011) and the plan's termination. Investors can track these trades through public filings on Form 144 and Form 4 with the Securities and Exchange Commission.