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EXHIBIT 99.5
CISCO SYSTEMS, INC.
STOCK OPTION ASSUMPTION AGREEMENT
WEBLINE COMMUNICATIONS CORPORATION
1997 STOCK INCENTIVE PLAN
OPTIONEE: [Employee],
STOCK OPTION ASSUMPTION AGREEMENT effective as of the 2nd day of
November, 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 WebLine
Communications Corporation, a Delaware corporation ("WebLine"), which were
granted to Optionee under the WebLine 1997 Stock Incentive Plan (the "Plan") and
are each evidenced by a Stock Option Agreement (the "Option Agreement").
WHEREAS, WebLine has been acquired by Cisco through the merger
of WebLine with and into Cisco (the "Merger") pursuant to the Agreement and Plan
of Reorganization, by and between Cisco and WebLine (the "Merger Agreement").
WHEREAS, the provisions of the Merger Agreement require Cisco to
assume all obligations of WebLine 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 Merger Agreement, the
exchange ratio (the "Exchange Ratio") in effect for the Merger is 0.15948147 of
a share of Cisco common stock ("Cisco Stock") for each outstanding share of
WebLine common stock ("WebLine Stock").
WHEREAS, this Agreement became effective immediately upon the
consummation of the Merger (the "Effective Time") in order to reflect certain
adjustments to Optionee's outstanding options that 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 WebLine Stock subject to the
options held by Optionee immediately prior to the Effective Time (the "WebLine
Options") and the exercise price payable per share are set forth below. Cisco
hereby assumes, as of the Effective Time, all the duties and obligations of
WebLine under each of the WebLine Options. In connection with such assumption,
the number of shares of Cisco Stock purchasable under each WebLine Option hereby
assumed and the exercise price payable thereunder have been adjusted to reflect
the Exchange Ratio.
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Accordingly, the number of shares of Cisco Stock subject to each WebLine Option
hereby assumed shall be as specified for that option below, and the adjusted
exercise price payable per share of Cisco Stock under the assumed WebLine
Option shall also be as indicated for that option below.
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WEBLINE STOCK OPTIONS CISCO ASSUMED OPTIONS
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# of Shares of Webline Exercise Price per # of Shares of Adjusted Exercise Price
Common Stock Share Cisco Common Stock per Share
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[WebLine Shares] $[WebLine Price] [Cisco Shares] $[Cisco Price]
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2. The intent of the foregoing adjustments to each assumed
WebLine 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
that existed, immediately prior to the Merger, between the then aggregate fair
market value of the WebLine Stock subject to the WebLine 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 WebLine Option immediately prior
to the Merger.
3. Your WebLine Option may have been incorrectly documented
with an expiration date later than ten (10) years from the date of grant, in
violation of the terms of the Plan and the Internal Revenue Code (the "Code").
To comply with the terms of the Plan and the Code, your option is hereby
corrected and will expire on [expiration date].
4. The following provisions shall govern each WebLine
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 "Common Stock" or "Stock"
shall mean share 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) Except as modified in paragraph 3, the grant
date and the expiration date of each assumed WebLine Option and
all other provisions which govern either the exercise or the
termination of the assumed WebLine 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.
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(c) Pursuant to the Plan, none of your options
assumed by Cisco in connection with the transaction will vest
and become exercisable on an accelerated basis upon the
consummation of the Merger. Each WebLine Option shall be assumed
by Cisco as of the Effective Time. Each such assumed WebLine
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.
(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 WebLine, 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 WebLine Options upon
Optionee's cessation of service as an employee or a consultant
of WebLine shall hereafter be applied on the basis of Optionee's
cessation of employee or consultant status with Cisco and its
subsidiaries, and each assumed WebLine Option shall accordingly
terminate, within the designated time period in effect under the
Option Agreement for that option, generally a ninety (90)-day
period, 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 WebLine 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 WebLine Stock prior to the Merger shall
be taken into account.
(f) In order to exercise each assumed WebLine
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.
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Attention: Stock Administration
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5. 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 2nd day of November, 1999.
CISCO SYSTEMS, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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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 WebLine Communications Corporation 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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