Cisco 2011 Annual Report Download - page 127

awarded in combination with stock options or stock grants, and such awards shall provide that the stock
appreciation rights will not be exercisable unless the related stock options or stock grants are forfeited. Stock
grants may be awarded in combination with non-statutory stock options, and such awards may provide that the
stock grants will be forfeited in the event that the related non-statutory stock options are exercised.
1996 Plan The 1996 Plan expired on December 31, 2006, and the Company can no longer make equity awards
under the 1996 Plan. The maximum number of shares issuable over the term of the 1996 Plan was 2.5 billion
shares. Stock options granted under the 1996 Plan have an exercise price of at least 100% of the fair market value
of the underlying stock on the grant date and expire no later than nine years from the grant date. The stock
options generally become exercisable for 20% or 25% of the option shares one year from the date of grant and
then ratably over the following 48 or 36 months, respectively. Certain other grants have utilized a 60-month
ratable vesting schedule. In addition, the Board of Directors, or other committees administering the plan, have the
discretion to use a different vesting schedule and have done so from time to time.
Supplemental Plan The Supplemental Plan expired on December 31, 2007, and the Company can no longer
make equity awards under the Supplemental Plan. Officers and members of the Company’s Board of Directors
were not eligible to participate in the Supplemental Plan. Nine million shares were reserved for issuance under
the Supplemental Plan.
Acquisition Plans In connection with the Company’s acquisitions of Scientific-Atlanta, Inc. (“Scientific-
Atlanta”) and WebEx Communications, Inc. (“WebEx”), the Company adopted the SA Acquisition Plan and the
WebEx Acquisition Plan, respectively, each effective upon completion of the applicable acquisition. These plans
constitute assumptions, amendments, restatements, and renamings of the 2003 Long-Term Incentive Plan of
Scientific-Atlanta and the WebEx Communications, Inc. Amended and Restated 2000 Stock Incentive Plan,
respectively. The plans permit the grant of stock options, stock, stock units, and stock appreciation rights to
certain employees of the Company and its subsidiaries and affiliates who had been employed by Scientific-
Atlanta or its subsidiaries or WebEx or its subsidiaries, as applicable. As a result of the shareholder approval of
the amendment and extension of the 2005 Plan, as of November 15, 2007, the Company will no longer make
stock option grants or direct share issuances under either the SA Acquisition Plan or the WebEx Acquisition
Plan.
(b) Employee Stock Purchase Plan
The Company has an Employee Stock Purchase Plan, which includes its subplan, the International Employee
Stock Purchase Plan (together, the “Purchase Plan”), under which 471.4 million shares of the Company’s
common stock have been reserved for issuance as of July 30, 2011. Effective July 1, 2009, eligible employees are
offered shares through a 24-month offering period, which consists of four consecutive 6-month purchase
periods. Employees may purchase a limited number of shares of the Company’s stock at a discount of up to 15%
of the lesser of the market value at the beginning of the offering period or the end of each 6-month purchase
period. The Purchase Plan is scheduled to terminate on January 3, 2020. The Company issued 34 million,
27 million, and 28 million shares under the Purchase Plan in fiscal 2011, 2010, and 2009, respectively. As of
July 30, 2011, 122 million shares were available for issuance under the Purchase Plan.
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