8-KLeadership ChangesExhibits & Filings

CISCO SYSTEMS, INC. 8-K Report, Executive Changes (Jun 1, 2015)

Filed June 1, 2015For Securities:CSCO

Summary

Cisco Systems, Inc. (CSCO) filed an 8-K on June 1, 2015, reporting the departure of two key executives: Robert W. Lloyd, President, Development and Sales, and Gary B. Moore, President and Chief Operating Officer. Their departures are effective July 25, 2015, coinciding with the end of Cisco's fiscal year 2015, and are part of a decision by the company to eliminate their respective positions. Both executives have entered into separation agreements that outline their compensation and benefits upon leaving. These agreements include the eligibility for their fiscal year 2015 bonuses, accelerated vesting of certain time-based restricted stock units, and potential vesting of performance-based restricted stock units contingent on achieving performance goals. Additionally, they will receive substantial cash severance payments and extended post-termination exercise periods for stock options, details of which are provided in the filed separation agreements.

Key Highlights

  • 1Departure of Robert W. Lloyd (President, Development and Sales) and Gary B. Moore (President and Chief Operating Officer) effective July 25, 2015.
  • 2The company is eliminating the positions of President, Development and Sales, and President and Chief Operating Officer.
  • 3Both executives are eligible for their fiscal year 2015 bonuses, contingent on serving through the end of the fiscal year.
  • 4Accelerated vesting of time-based restricted stock unit awards scheduled to vest in September 2015 and September 2016.
  • 5Potential vesting of performance-based restricted stock unit awards for September 2017, subject to performance goal achievement.
  • 6Cash severance payments of $2,200,000 for Mr. Lloyd and $2,268,750 for Mr. Moore, payable in calendar 2016.
  • 7Extended post-termination exercise period for stock options with an exercise price greater than Cisco's stock price at separation.

Frequently Asked Questions

Robert W. Lloyd and Gary B. Moore are leaving Cisco as a result of the company's decision to eliminate their respective positions: President, Development and Sales, and President and Chief Operating Officer.

Both executives will receive their fiscal year 2015 bonuses (if they serve through year-end), accelerated vesting for certain restricted stock units, and potential vesting for performance-based restricted stock units. They will also receive cash severance payments ($2.2M for Mr. Lloyd, $2.26875M for Mr. Moore) and an extended period to exercise their stock options.

The departures are effective July 25, 2015, which is the end of fiscal year 2015. The severance packages, including bonuses and accelerated vesting, are contingent upon them serving through the end of fiscal year 2015 and, for performance-based awards, the achievement of specific performance goals.

This 8-K filing specifically addresses executive departures and their associated separation agreements. While the elimination of these senior roles might imply organizational restructuring or strategic shifts, this particular filing does not provide details on operational strategy changes or current financial performance.