8-KLeadership Changes

CISCO SYSTEMS, INC. 8-K Report, Executive Changes (Mar 13, 2017)

Filed March 13, 2017For Securities:CSCO

Summary

Cisco Systems, Inc. (CSCO) announced a significant addition to its Board of Directors with the appointment of Brenton L. Saunders. Mr. Saunders, who holds the positions of Chairman, Chief Executive Officer, and President at Allergan plc, brings extensive leadership experience in the healthcare and technology sectors. His appointment is effective March 13, 2017, and he will receive standard compensation for non-employee directors, including a pro-rata annual retainer and equity awards. The inclusion of Mr. Saunders is likely intended to enhance the Board's strategic oversight and industry expertise. Investors should note that Mr. Saunders's compensation will be prorated for his service through the remainder of the fiscal year ending at Cisco's 2017 annual meeting. This includes a cash retainer of $75,000 and an equity award valued at $215,000, both of which are prorated. He may also receive additional fees for committee meetings. Cisco has also entered into a standard director indemnification agreement with Mr. Saunders, ensuring he is protected against potential liabilities arising from his service.

Key Highlights

  • 1Brenton L. Saunders, CEO of Allergan plc, appointed to Cisco's Board of Directors as of March 13, 2017.
  • 2Mr. Saunders's appointment is expected to bring valuable leadership and industry expertise to the Board.
  • 3Compensation for Mr. Saunders will include a pro-rata annual cash retainer of $75,000.
  • 4Mr. Saunders received an initial pro-rata equity award valued at $215,000, covering 4,728 shares.
  • 5The equity award is fully vested upon grant, with an option for deferred settlement.
  • 6Potential additional fees of $2,000 per committee meeting are applicable if Mr. Saunders serves on any Board committees.
  • 7Cisco has entered into a standard director indemnification agreement with Mr. Saunders.

Frequently Asked Questions

Brenton L. Saunders is the Chairman, Chief Executive Officer, and President of Allergan plc. His appointment to Cisco's Board of Directors is intended to leverage his significant leadership experience and industry insights to strengthen the Board's strategic oversight and governance.

Mr. Saunders will receive Cisco's standard compensation for non-employee directors. This includes a pro-rata annual cash retainer of $75,000 and a pro-rata initial equity award of 4,728 shares, valued at $215,000 on the grant date. He may also receive $2,000 per committee meeting attended if appointed to any committees.

Cisco has entered into its standard director indemnification agreement with Mr. Saunders. This agreement aims to protect him from potential liabilities, expenses, and settlements arising from his service as a director, to the fullest extent permitted by California law and Cisco's charter documents. This is a common practice to attract and retain qualified directors.

The initial equity award is fully vested upon grant. However, non-employee directors have the option to defer the settlement of such awards, meaning the shares may be delivered after the director departs the Board. The filing does not specify Mr. Saunders's election regarding deferral.