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EXHIBIT 99.8
CISCO SYSTEMS, INC.
STOCK OPTION ASSUMPTION AGREEMENT
1997 PIPELINKS STOCK OPTION PLAN
AND INDEPENDENT OPTIONS
OPTIONEE: Employee
STOCK OPTION ASSUMPTION AGREEMENT effective as of the 4th day of March,
1999 by Cisco Systems, Inc., a California corporation ("Cisco").
WHEREAS, the undersigned individual ("Optionee") holds one or more
outstanding options to purchase shares of the common stock of Pipelinks, Inc., a
California corporation ("Pipelinks"), which were granted to Optionee either
directly by Pipelinks independent of an option plan, or under the Pipelinks 1997
Stock Option Plan ( the "Plan") and are each evidenced by a Stock Option
Agreement (the "Option Agreement").
WHEREAS, Pipelinks has been acquired by Cisco through the merger of
Pipelinks with and into Cisco (the "Merger") pursuant to the Amended and
Restated Agreement and Plan of Reorganization dated March 4, 1999 by and between
Cisco and Pipelinks (the "Reorganization Agreement").
WHEREAS, the provisions of the Reorganization Agreement require Cisco to
assume all obligations of Pipelinks under all outstanding options under the Plan
at the consummation of the Merger and to issue to the holder of each outstanding
option an agreement evidencing the assumption of such option.
WHEREAS, pursuant to the provisions of the Reorganization Agreement, the
exchange ratio (the "Exchange Ratio") in effect for the Merger is 0.100248 of a
share of Cisco common stock ("Cisco Stock") for each outstanding share of
Pipelinks common stock ("Pipelinks Stock").
WHEREAS, this Agreement is to become effective immediately upon the
consummation of the Merger (the "Effective Time") in order to reflect certain
adjustments to Optionee's outstanding options which have become necessary by
reason of the assumption of those options by Cisco in connection with the
Merger.
NOW, THEREFORE, it is hereby agreed as follows:
1. The number of shares of Pipelinks Stock subject to the options held by
Optionee immediately prior to the Effective Time (the "Pipelinks Options") and
the exercise price payable per share are set forth in Exhibit(s) A hereto. Cisco
hereby assumes, as of the Effective Time, all the duties and obligations of
Pipelinks under each of the Pipelinks Options. In connection with such
assumption, the number of shares of Cisco Stock purchasable under each Pipelinks
Option hereby assumed and the exercise price payable thereunder have been
adjusted
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to reflect the Exchange Ratio. Accordingly, the number of shares of Cisco Stock
subject to each Pipelinks Option hereby assumed shall be as specified for that
option in attached Exhibit(s) A, and the adjusted exercise price payable per
share of Cisco Stock under the assumed Pipelinks Option shall also be as
indicated for that option in attached Exhibit(s) A.
2. The intent of the foregoing adjustments to each assumed Pipelinks
Option is to assure that the spread between the aggregate fair market value of
the shares of Cisco Stock purchasable under each such option and the aggregate
exercise price as adjusted pursuant to this Agreement will, immediately after
the consummation of the Merger, be not less than the spread which existed,
immediately prior to the Merger, between the then aggregate fair market value of
the Pipelinks Stock subject to the Pipelinks Option and the aggregate exercise
price in effect at such time under the Option Agreement. Such adjustments are
also intended to preserve, immediately after the Merger, on a per share basis,
the same ratio of exercise price per option share to fair market value per share
which existed under the Pipelinks Option immediately prior to the Merger.
3. The following provisions shall govern each Pipelinks Option hereby
assumed by Cisco:
(a) Unless the context otherwise requires, all references in each
Option Agreement and, if applicable, in the Plan (as incorporated into such
Option Agreement) (i) to the "Company" shall mean Cisco, (ii) to "Stock" shall
mean shares of Cisco Stock, (iii) to the "Board" shall mean the Board of
Directors of Cisco and (iv) to the "Committee" shall mean the Compensation
Committee of the Cisco Board of Directors.
(b) The grant date and the expiration date of each assumed Pipelinks
Option and all other provisions which govern either the exercise or the
termination of the assumed Pipelinks Option shall remain the same as set forth
in the Option Agreement applicable to that option, and the provisions of the
Option Agreement shall accordingly govern and control Optionee's rights under
this Agreement to purchase Cisco Stock.
(c) Pursuant to the terms of the Option Agreement, none of your
options assumed by Cisco in connection with the transaction will terminate and
cease to outstanding upon the consummation of the Merger. Each Pipelinks Option
shall be assumed by Cisco as of the Effective Time. Each such assumed Pipelinks
Option shall thereafter continue to vest for any remaining unvested shares of
Cisco Stock subject to that option in accordance with the same installment
vesting schedule in effect under the applicable Option Agreement immediately
prior to the Effective Time; provided, however, that the number of shares
subject to each such installment shall be adjusted to reflect the Exchange
Ratio.
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(d) For purposes of applying any and all provisions of the Option
Agreement and/or the Plan relating to Optionee's status as an employee or a
consultant of Pipelinks, Optionee shall be deemed to continue in such status as
an employee or a consultant for so long as Optionee renders services as an
employee or a consultant to Cisco or any present or future Cisco subsidiary.
Accordingly, the provisions of the Option Agreement governing the termination of
the assumed Pipelinks Options upon Optionee's cessation of service as an
employee or a consultant of Pipelinks shall hereafter be applied on the basis of
Optionee's cessation of employee or consultant status with Cisco and its
subsidiaries, and each assumed Pipelinks Option shall accordingly terminate,
within the designated time period in effect under the Option Agreement for that
option, following such cessation of service as an employee or a consultant of
Cisco and its subsidiaries.
(e) The adjusted exercise price payable for the Cisco Stock subject
to each assumed Pipelinks Option shall be payable in any of the forms authorized
under the Option Agreement applicable to that option. For purposes of
determining the holding period of any shares of Cisco Stock delivered in payment
of such adjusted exercise price, the period for which such shares were held as
Pipelinks Stock prior to the Merger shall be taken into account.
(f) In order to exercise each assumed Pipelinks Option, Optionee must
deliver to Cisco a written notice of exercise in which the number of shares of
Cisco Stock to be purchased thereunder must be indicated. The exercise notice
must be accompanied by payment of the adjusted exercise price payable for the
purchased shares of Cisco Stock and should be delivered to Cisco at the
following address:
Cisco Systems, Inc.
000 Xxxx Xxxxxx Xxxxx, Xxxxxxxx X
Xxx Xxxx, XX 00000
Attention: Option Plan Administrator
4. Except to the extent specifically modified by this Option Assumption
Agreement, all of the terms and conditions of each Option Agreement as in effect
immediately prior to the Merger shall continue in full force and effect and
shall not in any way be amended, revised or otherwise affected by this Stock
Option Assumption Agreement.
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IN WITNESS WHEREOF, Cisco Systems, Inc. has caused this Stock Option
Assumption Agreement to be executed on its behalf by its duly-authorized officer
as of the 4th day of March, 1999.
CISCO SYSTEMS, INC.
By: /s/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxxx
Corporate Secretary
ACKNOWLEDGMENT
The undersigned acknowledges receipt of the foregoing Stock Option
Assumption Agreement and understands that all rights and liabilities with
respect to each of his or her Pipelinks Options hereby assumed by Cisco are as
set forth in the Option Agreement, the Plan, as applicable, and such Stock
Option Assumption Agreement.
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EMPLOYEE, OPTIONEE
DATED: __________________, 1999
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